The Change Masters: Corporate Entrepreneurs at Work
by Rosabeth Moss Kanter (1983), is perhaps one of the seminal guidebooks on innovation. Within its pages, Kanter leads us through several American Corporations of the age discussing the relative merits (or not) of their various business structures as they relate to innovation.
To begin, Kanter defines innovation as:
Innovation refers to the process of bringing any new, problem solving idea into use. Ideas for reorganising, cutting costs, putting in new budgeting systems, improving communication, or assembling products in teams are also innovations. Innovation is the generation, acceptance and implementation of new ideas, processes, products and services. It can thus occur in any part of a corporation, and it can involve creative use as well as original invention. Application and implementation are central to this definition; it involves the capacity to change or adapt.
As such innovation is a central aspect of most modern businesses. There are very few businesses which can continue to do the day job unchanged as the years pass. Every business will eventually be faced with new challenges which will require it to innovate new strategies, management methodologies, or products to aid its survival. That said, innovation doesn’t happen every day, as the majority of the time, the work of the business will still continue along routinised jobs within siloed departments.
As discussed by Kanter, creating an environment to allow innovation to flourish is possible, but difficult. Non-innovating business tend to run along siloed departments or lines of business where problems in one line are solved by the same line, with little opportunity for sharing problems and solutions across lines. This results in a rather segmentalist organisation which fails to capitalise on shared solutions for shared problems, and in some cases can have different teams arrive at different solutions for the same problem.
By breaking down the barriers between lines, a more integrative approach can realise benefits of a multidisciplinary approach. Different skills of employees from different departments can analyse and propose solutions to shared problems which cross the business.
When it comes to creating an environment to allow innovation, Kanter suggest the following as a minimum set of requirements:
Encouragement of a culture of pride. Highlight the achievements of the company’s own people, through visible awards, through applying an innovation from one area to the problems of another – and letting the experienced innovators serve as “consultants”.
Enlarged access to power tools for innovative problem solving. Provide vehicles (a council? and R&D committee? direct access to the steering committee?) for supporting proposals for experiments and innovations – especially those involving teams or collaborators across areas.
Improvement of lateral communication. Bring departments together. Encourage cross-fertilization through exchange of people, mobility across areas. Create cross-functional links, and perhaps even overlaps. Bring together teams of people from different areas who share responsibility for some aspect of the same end product.
Reduction of unnecessary layers of hierarchy. Eliminate barriers to resource access. Make it possible for people to go directly after what they need. Push decisional authority downward. Create “diagonal” slices cutting across the hierarchy to share information, provide quick intelligence about external and internal affairs.
Increased – and earlier – information about company plans. Where possible, reduce secretiveness. Avoid surprises. Increase security by making future plans known in advance, making it possible, in turn, for those below to make their plans. Give people at lower levels a chance to contribute to the shape of change before decisions are made at the top. Empower and involve them at an earlier point – e.g. through task forces and problem-solving groups or through more open-ended, change-oriented assignments, with more room left for the person to define the approach.
Before these kinds of organisational changes can be made, of course, corporate leaders must make a personal commitment to do what is needed to support innovation. They must believe that times are different, understand that transforming nature of our era requires a different set of responses. They need a sense of sufficient power themselves that they can be expansive about sharing it. They need a commitment to longer-term objectives and longer-term measures. And they as individuals must think in integrative rather than segmentalist ways, making connections between problems, pulling together ideas across disciplines, viewing issues from many perspectives. In short, top executives need at leas some of the qualities of corporate entrepreneurs in order to support this capacity at lower levels in the organisation.
Creating an environment for innovation, is itself an innovation, almost requiring an inversion of the typical management hierarchy. Top level managers must support the innovation environment while allowing the solutions to be driven from the bottom up. The power to affect change must be pushed down the hierarchy so those closest to the effects of the business problem are given the opportunity to propose their solutions, and once an acceptable solution is found, then it must be fixed in place by process and organisational change.
Chris Collins 