When the oil price fell in 2014, it not only exposed the waste and inefficiency of the entire oil and gas industry but also a collective risk aversion to innovation and technology that had set in over previous years. Such was the fall it was clear that cost cutting alone would not be enough to make companies competitive, they would have to innovate to survive. But how does a company or team rise to the challenge of a new industry norm and become innovative? In fact, how does a company in any industry ensure it has an enduring capability to innovate?
There is no shortage of material on innovation processes and techniques to improve or maintain innovation performance (see previous articles). However, many of these overlook the role of people in innovation, assume they are all the same and will fit the system. The reality is that people are the biggest and the most influential factor of all so here we look at how to get this element of innovation right.
1.0 Teams are made of individuals
It’s obvious, but every organisation comprises individuals and each brings unique skills, experiences and qualifications. They also have a style and preferences; their own way of doing things. Two individuals with the same qualifications can carry out the same role successfully but differently, often dramatically so.
Equally, roles can appeal to individuals with particular preferences. For example, accountancy attracts those comfortable working with numbers, data, rules and logic. Conversely, an artist enjoys creativity, thriving on inspiration and free thought. It is fair to say a great accountant would probably not make a good artist and an artist would likely be a terrible accountant. This will be the case no matter how hard either tries; it is simply down to their strengths and preferences.
In any business there will be a mix of individuals and many will have innovation skills. Determining who they are and how they can contribute (or not) is the most important first step in improving innovation in an organisation, but how can this be done?
1.1 Analytical Psychology helps understand individuals
Analytical psychology was developed by Carl Gustav Jung and is in wide use today to help understand individuals. It provides the basis for personality assessments, emphasises the importance of the inner self and identifies two general attitudes:
- Extravert: Outer directed with a need for sociability, chooses people as a source of energy, often action orientated.
- Introvert: Inner-directed with a need for privacy and space, chooses solitude to recover energy, reflective.
It also highlights four functions:
- Thinking function: Logical, sees cause and effect relations, cool, distant, frank, questioning.
- Feeling functions: Creative, warm, intimate, a sense of valuing positively to negatively.
- Sensing function: Sensory, orientated toward the body and senses, detailed, concrete, present.
- Intuitive: Sees many possibilities in situations, goes with hunches, impatient with details, impractical, sometimes not present.
Most of us have a mix of these functions. The reader may reflect on his or her own at this point and may even start to identify some functions within the individuals of their organisation.
1.2 Observation provides insight
With the framework that Analytical Psychology provides, observing and listening can details about an organisation or team. For example, who is quiet in a meeting, who likes to dominate the conversation, who is full of enthusiasm to act, who talks about the risks? The answers to all of these questions provide indicators of functions and attitudes.
Public figures provide great examples of functions and attitudes. Consider Jurgen Klopp , the highly successful and exuberant Liverpool football club manager renowned for the relationships with his players and focus on being in the present.
In business, Richard Branson is known to be full of energy, always on the go and with a great ability to put thoughts into action. Elon Musk is known as an unemotional person and looks beyond what is visible, with an ability to focus on one thing to an incredible depth. Both are entrepreneurs and yet different in style and profile.
In the world of politics consider Angela Merkel; the most powerful woman in the world and known to be conscientious, tenacious and a safe pair of hands.
Whilst observation can offer the first clues about the functions and attitudes of a person it is not comprehensive or fool proof. This is partly because most of us can adapt in some ways to suit the circumstances, so a more detailed analysis and tools can help.
1.3 Detailed analysis through tools
There are verified tools that can provide detailed insight to individual preferences. Innovateer has worked with a number including Insights, C-me, Colour Persona and Myers Briggs which is one of the most famous. Each is based on the ‘Jungian’ model so outputs are comparable.
Each tool derives its output from an individual’s response to a series of questions. It provides fascinating insights into many aspects such as personality style, attitude to risk, creativity, communication preferences, value to a team, reaction to pressure. The results can even be placed in a specific context such as Safety Leadership or Innovation.
The output for each team member, when mapped together with the others, shows the balance in a team. It will highlight where the team is strong and where it may need attention. The balance (between functions and attitudes) will show the overall characteristics of the combined team and the suitability to meet its goals.
2.0 Assemble the right individuals to achieve goals
Of course, any team should comprise individuals able to meet its goals. The pace of change can make it difficult to achieve this consistently though, as the external business environment can rapidly turn once valid goals into outdated ones. If the goals are no longer valid, the team may no longer be right either.
As an example, some years ago and following the oil price crash in 2014, an Executive at my former employer stated, “our engineers aren’t innovative enough”. This was mostly true, but then innovation had not been a goal of the business for some time, it simply wasn’t needed due to a high oil price and easy returns. Why risk good returns for the sake of innovation?
In fact, the company’s entire engineering community had been conditioned to deliver ‘safe and reliable performance’, to design and procure systems that would ‘start up and stay up’. Teams had been put together and rewarded based on adherence to standards and processes, to engineer out variability and risk. Aversion to innovation was the result.
However, the downturn meant the whole sector had to find solutions to a crisis and learn how to produce oil at a lower cost. Goals had to change because the external environment changed. Suddenly creativity, innovation and new approaches were critical for company success, but many organisations and teams were ill-equipped for this new situation, hence the Executive’s statement.
“You can’t just throw four random people at a problem and expect them to solve it. Think about what sorts of skills and personalities will work best for your project. Then choose your team mates carefully”.
The McKinsey Way Ethan M. Rasiel
Expecting the personnel in an organisation to completely change and become more innovative in order to respond to the business environment wasn’t reasonable. The team composition had to be changed to become more innovative.
3.0 Team composition for optimum innovation
So what skills are needed for a team to be innovative? Innovation comprises;
- A creative element;
- An execution and delivery element.
Successful innovation must have both in order to create ideas and solutions then deliver output of substance and value. This presents a dichotomy as individuals who are strong creatively are often poor at execution and delivery. Equally, those strong at delivery often do not have the capacity to be creative, to relish ambiguity and identify opportunities within it. The need for (and value of) a combination is best illustrated by examples.
3.1 Small business example
The first example is from a small enterprise, known for its creativity and invention. The founder was frustrated by the company’s inabilities to commercialise its inventions and intellectual property. By using one of the profiling tools available, the analysis of its leadership team (mapped in Figure 1) indicated bias towards yellow and green preferences.