We are assuming that you want to create a fast moving, innovative organization that takes the world by storm. You want process innovation. You want new products and services. You want old products and services produced and sold in new ways and in new places. You want continuous improvements and you want breakthroughs. You want to get better and stronger faster than your competitors so you can become or remain the undisputed leader in your industry. Your company can achieve these things, but clearly not as a bureaucratic organization. To get an explosion of appropriate innovation you must find the way to direct and release the entrepreneurial spirit buried in your employees. Here are some simple steps that will open wide the doors of innovation. Raise the discomfort with the status quo.

At the heart of innovation is a healthy dissatisfaction with things as they are. Why else make change? Bureaucratic organizations become satisfied with their performance and focus energy on fighting for internal position and a share of the spoils. Innovative organizations look outside themselves to find and anticipate new challenges. They keep searching for a better way.

If you really want to raise the level of dissatisfaction don't let the system filter out unpleasant truth. Build direct lines to customers, suppliers and employees. Establish a system that allows you to carry on anonymous, in-depth e-mail conversations with random employees. You reply to a number to continue the dialog for as long as you like but the employee has the safety of anonymity. Then use the information to fix the larger system, not to hunt down the poor employee's supervisor or department head.

Adopt a customer and spend time with them.

Find out what suppliers think. Get together a panel of the lower-level consultants working with your organization. What have they learned about how the company functions? Once you, as a senior management team, have become truly dissatisfied with things as they are and determined to make them better, it's time to raise the level of dissatisfaction in the rest of the organization. Create a stretch vision or strategic intent. It is impossible to give employees the freedom they need to be innovative unless they are guided into alignment by some force other than hierarchical commands. Vision is a powerful tool for aligning the independent, innovative
employee.

Create a vision that stretches the organization beyond the present business-as-usual.

A strategic intent that reaches beyond what seems possible with existing resources, inherently calls for innovation. Such a vision or intent demands
organizational transformation, not just incremental improvements. It creates new freedoms and new responsibilities because it requires the creative energy of all employees.

Ask for help

We often attend the annual meeting of the top 100 officers of a company and listen to the CEO and the chief strategist lay out the strategy for the next year. Though they give brilliant presentations, too often we see a blankness or weariness in the audience. Why aren't they moved? If leaders are too perfect, nothing happens. As long as the CEO preaches from a position that says, "I know it all and I hope you all get it," the creativity of the audience is not evoked. Instead, they wait for the all-knowing to tell them how this applies to their area of work. Effective leaders admit that they don't know it all. Though they are sure the directions they point to contain fruitful opportunities for innovation and change, they know they need the creativity and help of everyone in the organization to find out what those specific opportunities are.

Find out what is blocking innovation and handle it decisively

Nothing creates cynicism faster than a senior management team that calls for innovation but leaves in place the systems and people who are obviously blocking it. Put a bureaucratic naysayers head on a pike. Create an environment in which people at all levels can get on with the work of turning the vision into a reality. Promote only those who sponsor rather than block innovation.

Search for and reward sponsors.

Sponsors are the critical link between top management and the innovators of the organization. They select, fund, nurture, guide, educate, question and redirect innovators. No system for promoting innovation can replace the courageous and vital sponsor who understands and cares about the idea and its intrapreneurial team. But effective sponsors are generally rare and underappreciated. Ask yourself, "Whose people are innovating?" Ask successful innovators, "In your darkest hour with this innovation, who was your sponsor?" You will discover that a tiny proportion of the company's managers are doing the lion's share of the successful sponsoring. The rest get in the way and/or lack the business judgment to know who or what to sponsor.
S Value all types of innovation

State the kinds of innovation you want and then don't change your mind before they come to fruition.

We have witnessed many tragedies of interrupted innovation. The company, after a long cost-cutting binge, decides that it cannot achieve profitability and growth through cutting costs alone. Therefore, senior management calls for new ventures, new products and new services. Would-be innovators throughout the company respond. Then, just as the flow of new revenue generating innovation nears the market and begins to encounter the costs of scale-up and market introduction, senior management decides to shift the focus back to process innovation and cost reduction. All that new product work is lost. To make matters worse, it takes a few years to fill the pipeline with breakthrough process innovations, so in the beginning mediocre process ideas are funded. Then the focus shifts again and breakthrough process projects are killed before fruition to make room for revenue focused innovation.

Keep the system open to all kinds of innovation all the time:

continual improvement, process breakthroughs, line extensions, new products and services, new ways of working together, new internal services and new organizational patterns. While the emphasis may change, all kinds of innovation have their place.

Create a mutable architecture.

The essence of an innovative organization is flexibility. The flexibility needed is not achieved by constantly changing the formal organizational structure. The innovative organization is a constantly changing network of relationships across the boundaries of the formal organization. A flexible organization is created on-the-fly by people seeking the connections that will enable them to do their best work.
Ask yourself, "What policies and institutions will foster the effective self organizing system? What force fields can I put in place that will guide its evolution toward constructive activities and forms?"

Build choice into the system

To build flexible systems that adapt to the challenges at hand, build choice into the lives of employees. In a bureaucracy, employees wait to be told what to do. In an intelligent organization, employees don't wait. They exercise their freedom of choice.

Kinds of choice you can build into your system:

1. Institute a 15% rule. 3M employees, by policy, use 15% of their time to work on new ideas of their own choosing.
2. Give employees more choice over which projects they work on. You'll find out who the real leaders are. Everyone will want to be on their team. Some projects that don't make sense at the practical level will die for lack of staff.
3. Let operating divisions choose how much staff service they want to buy from whom. Not only will costs drop, but staff services will improve. Former bureaucratic staffs will get creative in finding ways to satisfy the needs of their internal customers.

The Forest Service had two technical service centers each serving half of the country. Service to the national forests was not customer oriented. They gave the forests choice of which tech service center to use. Almost overnight the tech service centers became more concerned with providing cost effective services which were valued by their users.

Competition and duplication have a bad name in companies, but in truth, competition and duplication can be good or bad. Political competition to get control of a monopoly right to deliver services or provide components brings out the worst in people. When customers have choice, competition to be part of an evolving network providing solutions to customers brings out innovation, cost consciousness and a search for effectiveness.

Build community: be intolerant of selfish politics

Freedom is the product of a people's capacity to go to the core of their souls and to evoke constantly new and ennobling patterns of meaning and significance. William van Dusen Wishard You will find it easier to build choice into the system if you can trust your people to use it for the good of the organization and not just to make themselves look good at the expense of others. Build community spirit by creating visions of the future of the organization that address people's deepest values. Make the organization stand for something the employees can be proud of -- something that makes it worthwhile to rise above their selfish concerns as they cheer for the whole. The best leaders create a community of many leaders, all taking responsibility for more than their narrow areas of formal responsibility.
At the core of community is voluntary contribution to the whole, above and beyond the call of duty. Too strict an accounting for time, too brutal an MBO scheme, too much focus on narrow measures of performance, and community suffers. As leaders you can:

1. Respond with gratitude to all volunteer efforts to serve customers and make the organization more effective.
2. Create space for individuals to volunteer for team projects outside their normal jobs.
3. Make sure all managers understand that the volunteer sector inside the organization is the root of corporate community.

On the other side of community building is discouraging managers who are more interested in fighting over turf than building the strength of the whole. It is very easy for the people below to see which managers are builders of the organization and which are only builders of their own careers. It is apparently very difficult to tell from above. Too often those who fight for what they believe is right are labeled as "not team players," while those who earn points with the boss at the expense of the organization and its customers are seen as "willing to sacrifice for the good of the whole." Do not be fooled. Use 360i feedback.

To create an organization that has the integrating force of community, go out of your way to discourage and refuse to promote those who are primarily working to increase their own power. Some hints:

1. Be intolerant of finger pointing. Speak strongly to those who blame individuals rather than find the root cause of a problem.
2. Favor those individuals who correct the systemic sources of problems.
3. Build processes to reveal subordinates' opinions of leaders and managers.
4. Review the long term effects of a manager's tenure. If a manager's area falls apart soon after they leave, they probably created short term results at the expense of the long-term health of the organization. If many innovative successes were started during their tenure, you had someone who was working for the long-term good of the system.

Measure the rate of innovation
You get what you measure and pay attention to. If you want innovation, measure it. It's not easy to do, but the effort to do so puts people's attention on getting results with innovation.

Measure the environment for innovation
How will are you doing in creating an environment for innovation? Do a yearly innovation environment audit to findout.

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