Gone are the days of the 'familiar' and the 'known.' Different elements are now competing for the supremacy. Various economies and industries are driving their competitive index for preeminence.
So what is their mantra? Driving innovation!
This article considers strategies adopted by innovative and successful companies, industries and ecosystems.
So, what is the culture of innovation? Freedom for creativity? Freedom to fail? Is success 'thinking to be a leader'?
The culture of innovation generally comes from the attitude of people and the work environment. On a broader scale, it is dominated by the economy, external environment and infrastructure. The policy of the government and freedom are probably the biggest factors that contribute towards this cause.
What do successful and innovative leaders do?
Let us take a look at two innovative companies, the attitude of their leaders and their role in aligning their organisations for innovation:
"It is really dangerous if everyone in a company starts thinking the same way," says Michael Dell, one of the world's most successful innovators and founder of the $30-billion giant, Dell Computers which is a pioneer in introducing direct sales and mass customization of PC products while leaving out the middlemen.
Dell makes sure that everyone in his company takes a different approach in solving customers' problems. Every to-do statement in the company is handled with a straightforward questionnaire: "Can we do something new to get this done?"
The staff gets one-on-one with the suppliers to generate this brainstorm. Dell himself hangs out in chat-rooms taking feedback and testing creative problem-solving strategies with his customers. (Have you come across anyone on chat talking about Dell products?)
"If you take a look broadly through our company, we've got more empowered, innovative people than any other company in the world," says Steven Ballmer, Microsoft CEO, in an interview with BusinessWeek online. Ballmer claims to have a culture within Microsoft that fosters criticism and constructive suggestions.
Employees love to work at their will, they can criticise everything. Employees have freedom, so much that two researchers at Microsoft wrote a paper for Bill Gates that says: '10 crazy ideas to shake up Microsoft.' Now isn't that something!
What builds an innovative ecosystem?
We did some interesting fact-finding for Silicon Valley, an ecosystem which best nurtures the culture of innovation in the United States.
In the 1950s, post-World War era, Stanford University had thousands of acres of unutilised land. The university was also running into huge financial problems and a big demand for growth. Industry connections and university professors then established an area in the vicinity called Stanford Industrial Park: now extended and known as Silicon Valley.
The Stanford Industrial Park leased out spaces to various companies for 99 years. In came companies like GE and Eastman Kodak. Silicon Valley's one of the first inventions though came from a person named Le De Forest. This scientist working with the Federal Telegraph Company invented an amplifier. He got his funding from the Stanford university itself.
Tremendous business opportunities arising out of this invention grabbed the attention of venture capitalists and new startups began to rise. After 50 years, the Valley has become the dream place to be in for any entrepreneur on the planet.
So this was a case of adversity spawning huge success. From a nothing-to-lose situation, mired in a financial mess and facing huge demand, made people at Stanford take risks, generate new ideas and quickly executive them with the available funds. The same culture is still maintained in the Valley, with many startups raising funds to begin operations. What is the Valley then all about? Isn't it about maintaining a system that promotes risk-taking?
What builds an innovative country?
On a much-much broader scale, lets have a look at some of the initiatives from the American government:
The United States government gets consultation on making America more competitive and innovative globally through a committee which consists of CEOs of America's most innovative and Fortune 10 companies. The committee known as council of competitiveness also consists of chiefs of leading universities in the US.
Referring to the recent State of the Union address by President George W Bush, one could tell that the US discomfort is not very comfortable with other competent and rising economies like India and China. The warning sent out was these economies could unsettle the US in the next 5-10 years.
Does Japan have the same ecosystem?
The Japanese economy is mainly driven
What makes the Japanese work like this? The reasons could be anything: living habits or Japan's memory history of the World War II.
Japan had similar problems: a nothing-to-lose situation. World War-II had destroyed Japan. The economy had collapsed. People were jobless, industry was dead. There was no other option before the Japanese but to rebuild the whole economy from scratch. They got access to American innovation and cultural exchange since it entered into a treaty of peace signed by the allied nations. The Japanese kept on exploring US products (possibly through reverse-engineering) and after decades it has become an innovation giant.
Now it is the biggest exporter of automobiles, electronic components and computer parts.
Is India on the same path?
It can be said with some confidence that most innovation pioneers started out from a 'nothing-to-lose' situation. The Indian economy had looked really bad till a few years ago. But now, the world is realising the cost-effectiveness and quality of manpower in India. Indian youth are showing their skills in serving customers sitting thousands of miles away. India's top 5 per cent has now the same infrastructure and resources available in the US.
The question at this point we need to ask ourselves is: why someone else has to realise our talent?
Can we not realise it ourselves?
Why do we need to stay awake all night and follow an asked-to-do process?
Why only IBM had to take the initiative for automating scripts for automating call centre operations?
There are a lot of questions which need to be answered. The future could as dull as it seems bright. The most promising Indian youth are experiencing healthy salaries by doing grunt work for others. Is this killing the start-up culture in India? Graduates out of the colleges are getting straight into the job world. Is our creative talent getting drained?
People get risk-averse as soon as they settle down into a comfort zone. Isn't this the reason for the rise and fall of economies, too? India dominated 25 per cent of global trade in 17th century. Today it accounts for less than 1 per cent.
There is a lot that has to change for India. Indian schools and colleges still don't have a network of venture capitalists to give a headstart to creative talent. There are plenty of students from science-exhibitions demonstrating creative ideas, many of which could possibly give rise to the next billion-dollar company.
Of course, efforts in this direction have begun now. Foreign direct investment in India is rising every day. India now has a network of angel investors, like the one that created the innovation ecosystem in the Silicon Valley.
Can India then create that culture of innovation and become the next innovation giant? The answer is up to us.
So what can be done?
Organisations need to:
- Explore new market opportunities.
- Listen to and observe customers (customer-centric innovation).
- Motivate employees from top to bottom to follow the company's innovation goals, giving them freedom.
- Create a healthy culture inside organisations, build a team that is innovative and retain such talent for long-term benefits.
The youth need to:
- Give away short-term comfort for long-term benefits.
- Live a life of pride and self-satisfaction.
- Actively exchange ideas, take the problems head-on, find their solutions in the end. Don't just aim, shoot!
Some very interesting Innovation related blogs that I came through:
- HP CTO Phil Mckinney explains various facets of innovation in his weekly blog. (Killer Innovations): http://www.killerinnovations.com
- BusinessWeek innovation blog by Bruce Nussbaum. http://www.businessweek.com/innovate/NussbaumOnDesign/
- A massive innovation blog from a design experience company. http://blog.vanderbeeken.com/
- A companion to Fortune Magazine Innovation Forum. http://www.businessinnovation2005.com
The author is the COO of BrainReactions LLC, that runs Innovation Trip, a 7-day programme arranged for global leaders to help them spark innovation and creativity in their organisations, revolutionising work culture and reducing attrition. http://www.innovationtrip.com
