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Why Most Companies Fail at Innovation (And What to Do Instead)

Recognize This! – Innovation is not just the big, market-transforming end result, but the little ideas along the way.

What’s the most powerful word in business today? Innovation.

Read any blog, any news source, any prospectus and you will quickly stumble over “innovation.” How the company pursues innovation, how innovative the products are, how “innovation” is a core value of the company. And this is all well and good – innovation truly is what propels industries and markets ever forward.

But the real question smart companies should be encouraging every employee, in every role, to ask is: “What can I do, in what I do every day, to be more innovative? How can I innovate our product, our service approach, to better serve our customers, change the market, or push the company forward?”

Unfortunately, too many people think innovation is too big for them or “not in my job description.” I believe that’s because we as leaders have failed to explain what real innovation actually looks like. David Steinberg, chief executive of XL Marketing, gives a much better definition of innovation in a recent New York Times “Corner Office” column:

“Innovation to me doesn’t have to be about creating the light bulb or the telegraph. Innovation can be very important small changes to something that’s already working. That’s the stuff that’s overlooked, and it can take things to the next level.”

Innovation is the perseverance to keep searching, to keep tweaking, to keep making something better. In reality, it’s usually many small innovations over time that result in a huge “new” innovation that gets all the press.

Kaihan Krippendorff explains it as committing to continually looking for the fourth option:

“The ‘fourth option’ is the option others don’t see and don’t expect. Your competitors contemplate three choices and feel satisfied that they are considering enough. But the strategic innovator is not satisfied. She asks, what else? What other option are people overlooking?”

So, back to my original question – how do you encourage all employees to seek the fourth option, to pursue the small changes for continuous improvement?

You must help employees see and understand what this looks like in their daily work. The quickest, most positive, and most effective way to do so is through strategic recognition. Every time an employee demonstrates an attribute of innovation in this way, recognize them for it. Say, “John, thank you for contributing to our goal of continuous innovation with your diligence on the Suarez project. The way in which you kept asking the next question to drive to not just our standard solution, but a truly unique approach in this situation not only solved the client need, but gave us an avenue to advance our solution and meet an unexpected market need going forward. Well done!”

That specificity makes the difference for John by letting him know what exactly “innovation” looks like in his daily work. When publicized through an internal social newsfeed, it also serves as an excellent training mechanism for other employees who can see why John was recognized and emulate that behavior in their own work.

How is innovation encouraged in your organization? How are you innovative in your own work?

2 Factors Critical to Building Trust (and Engagement) at Work

Recognize This! – Managers must be willing to engage in the difficult aspects of managing others in order to help all employees achieve to their best ability.

As I continue to catch up on a backlog in my readers and research feeds, I’m seeing themes emerge. One is around the importance of trust for employee engagement. Employees who do not trust company leadership will not (indeed, cannot) engage as deeply in their work. They do not give their best efforts because they do not see the value and benefit of doing so.

Just a couple of key factors to building trust in the workplace jumped out at me.

1) Managers must be willing to have the hard conversations with low performing employees.

Many were surprised at recent survey that low performers are often more highly engaged than high performers. I was not, simply because low performers too often don’t know they are low performers. Therefore, they are quite happily skating by at work. It’s the effect on the high performers who see their lower producing colleagues getting away with it that dramatically impacts trust in the organization. Or, as Mark Murphy, CEO of Leadership IQ (the company that did the survey behind these results) said, “It shows high performers that the organization is not a meritocracy.”

Managers must be willing to have the difficult conversations with low performers, not only to help them improve their own skills and productivity, but to also help build trust with top performers that leadership will do the right thing to reinforce best effort from everyone.

2) Managers must appropriately value employee effort as well as achievement.

Let’s be honest. Every innovative approach and thought doesn’t work. We know that to be true at Globoforce where our core values are Respect, Imagination, Determination and Innovation. The four together drive our success. While it’s all well and good to imagine new ideas and approaches, unless we have the determination to see them realized and the respect for each other as we do, we will never truly deliver the innovation that pushes our industry ever forward.

And yet, part of that approach means we sometimes imagine something that doesn’t work as expected. But we can always learn something from that effort and apply those learning to continue to imagine and innovate. That’s the determination needed to keep moving forward. Without validation of and respect for the effort and encouragement to find the lesson (even in the failure) and move forward, employees would lose trust in our values and our goals as an organization.

What other elements are critical to building trust?

What Does “Meaningful Work” Really Mean?

Recognize This! – Only the employee can define what is meaningful work to them. Leaders, however, are critical for helping them catch the vision.

Yesterday, I wrote about the importance of engaging in meaningful work for employees. But what, exactly, does “meaningful work” mean? As I was catching up on my (admittedly large) backlog of news and blogs in my reader, I found this nugget from the Switch & Shift blog (which is rapidly becoming one of my favorite daily reads):

“Managers cannot make work meaningful for employees. Managers, however, can shape the workplace environment to let meaningful work become possible for employees. With a context set to let meaning be experienced, employees can leverage the environment to derive meaning from their work.

“Meaningful work is vague. What exactly is it? Assuredly it begins quite selfishly. But this is out of necessity. For work to be meaningful, it is the employee who must label it so. This requires a belief that meaningful work is a desired outcome from managements’ actions. And employees believe managements’ intentions and see actions aimed to let meaning emerge.”

This reminds me of the possibly apocryphal story of the senior military leader touring NASA Space Center during the early days of the space race. The leader noticed a janitor cleaning an area of mission control and asked, “What are you doing?” The janitor didn’t reply with the obvious, “I’m sweeping the floor.” No, he said, “I’m helping to put a man on the moon.”

In this story, the employee knew and understood the greater purpose of his efforts. Keeping a neat and clean work environment would help to eliminate distractions for the scientists and engineers in mission control, thereby helping to contribute to the greater space mission. This employee knew the meaning of his work.

Personally, I don’t lead a group of strategy consultants. I help companies change their cultures to ones of appreciation and recognition.

What do you do for work? What’s the real meaning of your work?

3 Tips to Become the Manager Employees Never Want to Leave

Recognize This! – People leave bosses, not companies. Good managers make sure their employees succeed before themselves.

We’ve all heard the truism that people quit managers not jobs. If retention of top performers and key talent is a priority for you, then one of the first places you should look for improvement is in the relationship between managers and employees. This recent article, for example, points to a recent survey showing 20% of people say their bosses hurt their career. Half of employees, on the other hand, said the boss had a positive impact.

The article goes on to share common advice we’ve all likely heard before: End micro-managing and help bosses learn the art of delegation. Help bosses feel secure in their role and the importance of leading a team so they are confident and comfortable in giving team members credit where credit is due instead of snatching it for themselves.

While that advice is quite true and valuable, I’m far more interested in why these managerial tactics work. It all boils down to these three points (supported by reams of research conducted by Teresa Amabile and Steven Kramer in The Progress Principle).

Employees need meaningful work.
Busy work kills the spirit. Yes, some work tasks are menial, repetitive and just have to get done. But doesn’t mean they aren’t meaningful. Good managers help employees see the greater value of even the most menial, repetitive tasks. Help your employees see how their efforts help move the greater mission forward.
Employees need to make progress in meaningful work.
But meaningful work isn’t enough. Employees also need to know they are getting somewhere. Good managers cast a vision for the future and help employees see where they are on the path to achieving that vision. Help employees see forward progress toward big goals by recognizing them for smaller achievements along the way.
Employees need recognition of efforts and achievements that make an impact.
All of this boils down to employees’ need for recognition. Don’t misunderstand me. This is not a grab for another trophy or a gold star. Employees simply need to know what they do matters within a bigger picture. Indeed, our Spring 2012 Workforce Mood Tracker survey showed 78% of employees said they would work harder if their efforts were better recognized.

Instead of micromanaging, micro-appreciate. Hone in on what your team members are doing and recognize smaller achievements and progress towards bigger goals. Instead of snatching credit for yourself, be the one to give credit to your team for success and let the entire company see how much you all achieve together.

What other attributes do you see in good managers? What made your best manager so good?

Useless Unless…

Recognize This! – Don’t forget the key ingredients to employee engagement and excellence.

I’ve written a few blog posts in the last couple of months where I noticed I used these two words in conjunction – Useless Unless. Two little letters of difference, yet a tremendous differentiator.

Think of the ramifications in real life:

The fastest car in the world is useless unless you put fuel in the tank.
The best education is useless unless you put it to work.
The most talented basketball player is useless unless you give him a basketball (and committed team) to play with.
An incredibly delicious dinner party is useless unless you have friends and family to invite and share it with.
Talented, high-potential employees are useless unless they know the end goal and how to help achieve it.

What’s missing that’s most important? “E”

Encourage – We need encouragement at work. Encouragement isn’t just something to be given in tough times, but also to let people know they’re on the right track – their work has greater meaning and purpose in achieving the bigger picture.
Extoll – Don’t forget the praise. Recognize people when they go above and beyond. Shout their achievements and contributions from the rooftops. Make sure they know their efforts are noticed, appreciated and valued.
Engage – If you Encourage and Extol, you’ve taken a giant step forward in creating a work environment in which people choose to engage. And engaged employees are more productive, more easily retained and more beneficial to the bottom line.

What else is useless unless… ?

3 Lessons for Employee Engagement through Recognition from XL Axiata

Recognize This! – Learning from others’ success can enhance our own efforts for engagement.

I enjoy Abhishek Mittal’s Mumblr blog. Abhishek is a senior consultant for Towers Watson based in Singapore. Recently he shared a case study on XL Axiata, an Indonesian mobile services operator and division of Axiata Group. In the case study, Xl Axiata explains four key steps they took to create an engaging work environment for employees, including a Performance-Based Culture:

“XL Axiata knew that if it wanted the employees to display the right behaviours, it had to recognize and reward these behaviours. The leaders shaped a culture where people and performance are talked about in the same breath. Employees who were creating value for the company were being recognized through company-wide emails and there was a focus on celebrating small successes in the long journey to achieve the vision. It also placed a higher emphasis on differentiating rewards based on performance. Mittal says,These initiatives helped employees build a clear line of sight to the company goals and sent a clear message that the company values high performance above everything.”

From this one focus alone, I see three clear lessons for employee engagement:

Recognize and Reward the How not just the What
Results (the What) can be achieved in many ways, not all of them positive (think Enron or any of the other recent scandals were the end was more important than the means). By focusing recognition and rewards on the right behaviours, XL Axiata is reinforcing that how the work is accomplished is as important as what is accomplished.
Celebrate progress on the way to the big win
While everyone must understand and work toward the ultimate vision and “big win,” small successes and progress along the way make the big win ultimately possible. Research conducted by Harvard Business School and reported in the book The Progress Principle by Teresa Amabile and Steven Kramer proved the single greatest motivator for employees is making progress in meaningful work. Doing so increases engagement.
Offer multiple, differentiated awards
Recognition and rewards must be differentiated based on several factors including level of effort, contribution and results achieved. Offering the same level of recognition to someone who came up with an innovative idea that could transform product direction as you also offer to someone who contributed as part of a team to a lesser initiative merely serves to demotivate those who achieve great ambitions. Offering differentiated awards (awards at various levels) ensures both proper recognition and reward activity as well as eliminating any concerns around recognition becoming expected or run-of-the-mill.

What major initiatives has your organization undertaken to encourage employee engagement?

Strategic Employee Recognition Critical to Strong Manager/Employee Relationships

Recognize This! – Gallup research shows “best” managers empower, recognize and communicate with their employees regularly, supported by an effective performance management system.

If present trends continue, this week’s series of blog posts may be an ongoing theme of “isn’t that obvious?” Yesterday, I shared results of the Parnassus Fund (consisting of companies that treat their employees well and with respect), which performs consistently better than the S&P. Today, I’m sharing about Gallup research showing the manager/employee relationship is critical to employee engagement.

I’m sure we’ve all uttered the truism: “People leave managers, not companies.” This is the research to back it up as featured in an Incentive magazine article:

“A new article from Gallup researchers points to the pivotal role that the employee-manager relationship plays in driving the performance of companies. Drawing on data from more than 50,000 employees across 10 major industries, the analysts found that while effective engagement and recognition programs are key to a company’s success, strong relationships between managers and their subordinates are the key factor in making those programs work.”

Breaking this down further:

70% of employees giving managers a “best” rating also ranked the company’s recognition and engagement system as very good (vs. only 5% who rated managers as “best” also saying recognition programs were poor)
85% of those rating their manager as “below average” said their recognition programs were poor

Call me an optimist, but I really believe the vast majority of managers want to do right by their employees. They want to facilitate excellent work and help their employees in the best way possible. Yet, why do so many fail? I also believe we don’t equip managers with the tools they need to be the best managers they can be.

Managers know they need to recognize and reward employees for exceptional effort. Perhaps they’ve even received training on this management philosophy. But have you given them the tool and process needed to not only recognize employees, but to do so in a meaningful, personal way tied to what matters most to your organization (demonstration of your core values in contribution to achieving strategic objectives)?

Desires and objectives without a means to deliver are nearly useless. Empower your managers to be the “best.”

Intentions for Building and Sustaining a Strong Company Culture Will Fail without a Process to Back It Up

Recognize This! – Give all employees the tools and systems needed to reinforce your desired culture every day for everyone.

Your company leadership makes a commitment to build a strong culture. They understand how powerful of a differentiator culture can be in the market. They know what kind of positive culture they want to instill and they take steps to make it happen. Yet over time, the culture changes into something else. What happened?

Over on the Fistful of Talent blog, Suzanne Ramsey tells a parable that ends this way:

“So, now we’re at the point in the story where the company is at a crossroads. To those who have been around a while, there is a feeling of the founding culture being unappreciated and not cared for by new employees coming in. To those newly joining, there is a feeling of having been slightly duped; that the descriptions of cool culture and being a different kind of firm, etc., shared during the recruiting process aren’t really true. Both groups are frustrated, and sad, and the early founders are befuddled. Their principles and priorities for the company, for differentiating itself through its awesome culture, have not changed. So what has?”

Read her story and it’s clear what happened – while there was every intention of sustaining and building the culture over time, there was no process to make it happen. Suzanne ends her post with these two recommendations (quoting on both points):

It is time to stop assuming that the desired culture will sustain itself as the company grows, and time to make sustaining the culture a key responsibility of ALL within the company. Identify and develop the skills (storytelling, interpersonal relationship building), programs, and actions necessary to do so. And hold everyone in the company explicitly accountable for doing so through their behaviors.

And it is time for the company to get laser focused on how it onboards and welcomes new employees into the fold, from leaders right on down to the most junior of hires. It is not fair to put the entire burden of acclimating to the new organization, a new job, a new culture, on a newly joining employee, no matter how senior. And it is not fair to have the entire burden rest on the company, either. New employee onboarding needs an overhaul.

While I agree with these two points, Suzanne has missed a key third step – the sustaining process for making sure your culture is not just understood but actively lived by every employee in their daily work. Yes, we must onboard new employees properly into the culture, and we must all own the responsibility of sustaining that culture – as leaders we must also give everyone the tools and methodology to do so daily.

So, what is the process? Strategic, social recognition focused on recognizing and rewarding employees when they live the culture. That is, when they demonstrate your key cultural attributes (your core values) in their daily work. And since this is the responsibility of all employees, then all employees must be empowered to recognize each other when they see someone living the values or embodying desired cultural attributes.

How is your culture proactively encouraged and sustained in your organization?

Today on Compensation Cafe: When You Can’t Differentiate Based on Compensation, What Do You Do to Stand Out?

Recognize This! – Merit increases and compensation packages are no longer sufficient to draw top talent (or keep them).

Research study after research study and poll after poll show that merit increases are no longer keeping up with cost of living. More to the point, compensation packages are no longer enough of a draw to lure top talent away from competitors or to keep your top talent from jumping ship.

Companies must differentiate on something more. Your culture – how your employees experience the work environment every day – is your most powerful differentiator in today’s market.

Check out my post today on Compensation Cafe to see more about why relying on compensation and Total Rewards alone will cause you to lose your top talent and how this is playing out in the highly competitive talent market in the tech industry in Silicon Valley.

How to Use Words of Appreciation & Recognition More Effectively

Recognize This! -Words have power. Use words of appreciation wisely.

I’m sitting in a hotel room in New York, watching the morning news. A big story is a change to national spelling bee competition in the US. Now, in addition to being able to spell uncommon, complex words, contestants must also know the definitions in a preliminary vocabulary test. Many participants (and parents) seem to be up in arms over this change – after all, it’s a “spelling” bee, not a “vocabulary” bee.

This change makes sense to me, however. What’s the value in knowing lots of words, even how to spell them correctly, if you don’t know what they mean or how to use them correctly? Indeed, knowing more words and how to use them correctly benefits the learner with expanded knowledge as well as those who may read or hear the learner use those words appropriately because much more information can be conveyed clearly and accurately.

The same is true with appreciation. We all know the words “Thank you.” We all (I hope) know we used use the words “thank you” to express appreciation. But the value of recognition goes so much further.

When we use the words “thank you” appropriately, then expand on them with deeper explanation of what we mean by “thank you” not only do we as the users of the words benefit, but far more do those who hear the words. Consider research featured in the GloboBlog that shows:

“An increasing body of evidence is showing that the employees who are GIVING the recognition and reward may be benefiting as much or more from a recognition moment than their colleagues.”

Think of it this way: Which has more power?

“Hey, John. Thanks! You’re great!”
(or)
“John, thanks for the detailed research you did in preparation for the meeting this morning. Thanks to your diligence, we were able to show the client our commitment to solving their challenges in creative and cost effective ways. I really appreciate the time and attention you committed to supporting this project.”

Words have power, especially words of appreciation and praise.

What’s the best message of appreciation you’ve received or given? What made it exceptional?

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