Today, it seems like just about every company in almost every industry needs innovation to remain competitive by providing added business value for its customers. Indeed, many companies tout innovation as its primary value proposition to its customers which typically provides them with a significant competitive market advantage. Companies in such situations either adapt and innovate, or lose out to their competitors and its management must continuously attempt to reinvent the most important aspects of the business on an ongoing basis while doing so at an ever-increasing rate of speed.
Recognizing this business reality and the Chief H.R. Officer’s desire to be an equal business partner to the CEO and his/her line management peers, H.R. should seize this opportunity by providing critical support services that directly impact the company’s innovation-related efforts.
To provide a practical background for these H. R. support services, it is important to understand several key aspects of innovation in most company environments.
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In many companies, innovation is critical to its short-term profitability and long-term sustainable growth.
Though some people typically think of innovation as coming from the mind of an individual, in today’s business world, it comes primarily from team-oriented endeavors which necessitates a high level of collaboration between various business functions, departments and disciplines.
Companies desire innovation in all aspects of the business – products, services, processes, methods, policies, procedures, and so on.
Most innovative companies follow the 70/20/10 rule – focusing 70% of its resources on improving existing business and technology, 20% on finding adjacent markets for its products and services, and 10% on new markets.
There is a difference between creative thinking, which is coming up with a new idea, and innovation which brings that new idea into practical business fruition as a profitable and sustainable business application.
When top management thinks of innovation, it thinks about the entire process – taking a creative idea, testing it, converting it to a practical business application, and implementing it in a timely, profitable and sustainable manner.
Implementing the practical business application in a timely, effective and efficient manner is just as important as the original creative idea itself.
Providing innovative products and services at a faster and faster rate of speed that satisfies the customer’s market need is a fact-of-business-life today that management and employees must be able to accept and operate accordingly.
A risk-adverse company culture is obviously counter-productive to innovation and must be modified to facilitate change.
We must understand the mindset of an innovator: “This individual is not afraid of change and views change as an opportunity …. is not resistant to change and, when an unforeseen challenge arises, embraces the challenge by staying purposeful and disciplined to see it through rather than going back to the ‘old way'” 1
The underlying foundation of innovation stems from having employees who feel that they are doing meaningful work that makes an important difference which, in turn, means that they are placed into the right job that allows them to best utilize their creative skills and abilities.
Key innovation-oriented positions within the company should be occupied by employees with the right kind of creative-thinking and change-oriented skills. Such key employees should be given the necessary job training, recognized for any major accomplishments, compensated properly, provided skills development opportunities, and, to the extent possible, advanced consistent with their job/career aspirations.
There are various approaches to implementing innovation based on how well the problem is defined and whether or not the sphere of knowledge used to solve the problem is well known. One school of thought, typically found in larger companies, argues for a special, cross functional team approach, such as skunk works, mavericks, R&D labs, outsourcing, innovation labs, and others. A second school of thought, typically found in smaller companies, argues that innovation stems from an engaged employee or a small group of such employees who, by their personal nature, always strive to do their jobs more effectively, more efficiently, with greater quality/reliability, in shorter periods of time and at less cost. Regardless of which approach is followed, it must be supported by top and middle management which creates a success-oriented work environment that provides the right amounts of staffing, money, consulting, equipment, space and technology, among others.[/message][su_spacer]
There are four areas of H. R. support services – Corporate Culture, Interviewing, Selection and Placement, Idea/Project Implementation and Continuous Training.
Though most companies will acquire some insights on culture from other companies and outside experts, a successful corporate culture will be primarily developed internally within the company. Most importantly, it should be recognized that the corporate culture statement primarily stems from the management actions (styles, plans, decisions, strategies, etc.) of the CEO and top management team (not just their words) in support of the company’s business strategy and their day-to-day management style. Without top management buy-in of the written culture statement; it is doomed. If the actions of the CEO and top management team are inconsistent with it, employees will quickly determine that it is just a sham. To lend critically-important credence to the statement’s authenticity, there should be several examples for each item that can clearly illustrate how the item was actually practiced and implemented by the management team. Such examples should be an integral part of any training or clarification of the culture itself. Lastly, a company’s culture is the foundation upon which all other aspects of innovation rests. The phrase “culture eats strategy for breakfast” is true in all innovation-oriented companies.
Typically, corporate culture statements include items that fall into one of three categories – business strategy, management styles, and interpersonal behaviors and core values. Below is a list of possible innovation-related items in each category for consideration within any company. Based on the actual research within any particular company, each appropriate item must be clearly defined in detail and properly illustrated with as many examples as possible.
Business Strategy: innovation, technology leader, market-driven, customer-driven, customer care, product quality, industry leader, financially strong, and any other item that is critical to the profitable and sustainable growth of the company.
Management Style: Democratic, participative, informal, accessible/open door, team-oriented problem-solving, accurate decision-making, promotion-from-within, and so on.
Interpersonal Behaviors and Core Values: creative-thinker, curious, inquisitive, imaginative, results-oriented, good listener, hard-working, trustworthy, welcomes diverse viewpoints, overcomes obstacles, resilient, team-oriented, problem-solver, detail-oriented, personal integrity, honesty, adapts to change well, and so on.
INTERVIEWING, SELECTION AND PLACEMENT
As a key part of any company’s employee engagement effort, the corporate culture statement should indicate the company’s desire to properly match each employee to a position which represents to the employee that he or she is doing meaningful work that makes an important difference in the company, while satisfying his or her job/career and skills development goals. To achieve that end, the thorough interviewing, accurate selection and proper placement of any external applicants and/or internal employees for any KEY innovation-related position is critically important.
The first step here involves the interviewing process itself. Have the applicants and/or employees interviewed by at least two managers, including the hiring manager, who work in the department AND at least two managers who work in adjacent departments or disciplines that interact with the open position. Have each manager evaluate the person’s interview responses in relation to all of the basic qualifications for the position, while certain managers can also concentrate on particular qualifications, such as innovation-related experience and/or technical expertise. Have the person return for a second interview with the hiring manager to resolve any questions or issues uncovered in the first interview, while being ready to make an offer on the spot if all issues are resolved satisfactorily.
The second step is to fully evaluate an applicant’s innovative skills and abilities by utilizing an appropriate mix of the: a) innovation-related interpersonal behaviors and core values listed in the corporate culture statement through the use of a company-validated test instrument for such behaviors, b) innovation-related technical and job skills acquired in previous positions and c) specific innovation-related past accomplishments or projects in which the applicant claimed to have initiated and/or participated. The evaluation of these last two items should result from a deep-dive, technical interview conducted by a technically-qualified manager and, preferably, the Team Leader.
The third step is to evaluate of each applicant’s skills and abilities in relation to all of the job qualifications in a weighted selection matrix. Here is an example for a Senior Electrical Engineer position that requires 5 years of experience.
For example, using an evaluation rating scale of 1 through 5, an applicant’s excellent rating of 4 on Innovation-related past accomplishments would be calculated as 4 x .15 = .6. Utilizing such a matrix allows you to evaluate each qualification segment and the major qualifications within each segment, while providing an overall evaluative rating.
The fourth step involves the placement of the external hires and/or internal employees into the appropriate team positions. Prior to matching any person to a team position, the HR person and the Team Leader should jointly review each job description and selection matrix results in detail. Then, for employees, review the employee skills data base within the HRIS system for their current skills set, recent innovation-related performance accomplishments, and relevant interpersonal behavior skills, and, for new hires, the interview findings regarding their interpersonal behaviors test results, innovation-related skills and accomplishments. Now, the HR person and the Team Leader can match the right people to the right positions. In doing so, it is always helpful to identify people who, if and when needed, can act as a back-up to the Team Leader and any other key team position, especially for any position requiring critical technical or project management skills.
First, any innovation team should be composed of diverse cross-functional skills, opinions and viewpoints that directly related to the subject, as well as having a leader who understands the business necessity of improving performance and, in turn, can moderate and control the team members to achieve the necessary business performance improvement. The team’s understanding of how to implement any new idea – faster, with better quality and efficiency, and at less cost – is critical and should be emphasized in most team meetings and endeavors. Without proper implementation; the idea is almost useless.
Second, it is important to acknowledge that the work of most teams must be achieved on schedule while recognizing that many important team projects occur over a lengthy time span. Also, many key projects are tied directly into other key projects within the company so that, when combined, they are designed to achieve an even larger specific business objective.
Third, it is important that management or any Innovation committee have available to them a wide array of incentives and rewards, including a base team reward with escalating levels of performance, individual rewards, spot and end-of-project bonuses, merit increase add-ons, stock awards, and so on. Based on past practice, managements tend to use whatever types of rewards seem to work best for its employees, recognizing that such rewards should be personalized to each individual team member whenever possible. Regarding incentives, H.R. should be recommending and tracking the various rewards to ensure a fair and equitable distribution. Also, appropriate recognition for exemplary team and individual performance through the company’s intranet, portals, social media, etc., is appropriate. Having team celebration events are also used in many companies. Such recognition should be at regular intervals and whenever important events occur. Since the best recognition for stellar performance by various team members is still promotional and compensation advancement, H. R. should track all appropriate actions while insuring that the best employees are treated fairly.
First, since the use of project management techniques are crucial to achieving these important team and innovation-oriented business objectives on time, H. R. should provide such training as an ongoing service for all such projects. Also, it is important that such project management training should be provided in support of all the company’s other product development efforts which are part of its short-term and long-term business growth.
Second, H. R. should be providing training on the various analytical tools utilized to achieve innovation, such as step-by-step process analysis (current vs. recommended), brainstorming, cause-effect diagramming, data analysis techniques that identify patterns, testing of potential solutions, and any other techniques that are typically used within the company.
Third, H. R. should be providing training on why innovation is so critical to the company’s short and long-term business success (and thereby the job security, skills development and promotional advancement opportunities of its employees), within the context of how to overcome any potential employee resistance to change. This training should be a major part of the On Boarding program and presented at the start of any major team project.
The harsh reality of today’s highly competitive business world is that short-term business profitability and long-term business growth requires a significant and sustainable innovation capability. Typically, such innovation creates a major competitive advantage for the company in the marketplace. Therefore, short-term and long-term business growth require that a company utilizes its best and brightest employees to lead and participate in these innovation projects.
In an effort to become an equal business partner to the CEO and line executive management, the Chief H. R. Officer should seize this opportunity to become a major part of the company’s operational mainstream (rather than acting solely as an administrative service) by providing critical H. R. services that will greatly improve the company’s chances of business success in these vital innovation-related efforts.
1 Melinda Fouts. Ph.D., The Mindset of An Innovator