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Monograph: Innovation Leadership © Lawrence Hiner 1 22 September 2007 Innovation Leadership a monograph Lawrence E Hiner III, Psy.D. [email protected] © 2007

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2007 dissertation monorgaph on the intersection of Innovation and Leadership

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Page 1: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 1 22 September 2007

Innovation Leadership

a monograph

Lawrence E Hiner III, Psy.D.

[email protected]

© 2007

Page 2: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 2 22 September 2007

Table of Contents

Chapter 1: Introduction..............................................................................5

Chapter 2: Intersecting concepts used throughout this monograph...............8

Pre-modern, Modern, Post-modern ........................................................10

Appreciative Approach ..........................................................................15

Turbulence...........................................................................................18

Climate (vs. Culture) .............................................................................21

Chapter 3: Innovation ..............................................................................24

What is innovation? ..............................................................................24

The Continuum of Innovation ................................................................26

Ideation............................................................................................27

Invention ..........................................................................................28

Instantiation .....................................................................................29

Adoption...........................................................................................31

Innovation Management .......................................................................36

Innovative climate ................................................................................42

Operational Definition ...........................................................................50

Appreciative......................................................................................50

Adaptation ........................................................................................52

Turbulence .......................................................................................53

Chapter 4: Leadership ..............................................................................61

Page 3: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 3 22 September 2007

What is leadership?...............................................................................61

Modern view of leadership .................................................................62

Postmodern view of leadership...........................................................66

Pervasive leadership ..........................................................................80

Chapter 5: Innovation Leadership .............................................................84

The intersection of innovation and leadership.........................................84

Application of the theories.....................................................................87

Engagement Model............................................................................87

Survey..............................................................................................88

Categories ........................................................................................92

Specific characteristics and survey statements........................................93

Individual..........................................................................................93

Organizational...................................................................................95

Glossary of Terms used in the survey statements ...................................98

Adaptive Challenges ..........................................................................98

Democratizing innovation...................................................................98

Double-loop Learning ........................................................................99

Effective use of peripheral energy and information ..............................99

Information Communities................................................................. 100

Innovate or Buy Decisions ............................................................... 100

Innovation Communities .................................................................. 101

Lead Users...................................................................................... 101

Page 4: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 4 22 September 2007

Leadership ...................................................................................... 102

Learning Paradox ............................................................................ 102

Strategic points of change (Watson’s SPA Model) .............................. 104

Theory-in-use ................................................................................. 104

Theory X and Theory Y.................................................................... 105

References ............................................................................................106

Page 5: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 5 22 September 2007

Chapter 1: Introduction Innovation Leadership is the intersection of the best theory and practice in

each of the respective disciplines (that is, innovation and leadership) that,

appropriately applied, will lead to the enhancement of the innovative climate

across an organization.

In 1994, Peter Drucker observed:

"Every few hundred years in Western history there occurs a sharp transformation... Within a few short decades, society rearranges itself - its worldview; its basic values; its social and

political structure; its arts; its key institutions. Fifty years later, there is a new world. And the people born then cannot even imagine the world in which their grandparents lived and into

which their own parents were born. We are currently living through just such a transformation. (p. 1)

"Nothing 'post' is permanent or even long-lived. Ours is a

transition period. What the future society will look like, let alone whether it will indeed be the 'knowledge society' some of us dare hope for, depends on how the developed countries

respond to the challenges of this transition period, the post-capitalist period - their intellectual leaders, their business leaders, their political leaders, but above all each of us in our

own work and life. Yet surely this is a time to make the future - precisely because everything is in flux. This is a time for action.

(p. 16) (Drucker, 1994)

But, what action can be taken? What are the organizational constructs within

which “each of us” can “respond to the challenges of this transition period?”

What are the enabling factors that facilitate this change?

As if in response to Drucker’s question, Klaus Schwab and Pamela Hartigan

recently wrote: “If there is one thing about which public and corporate

leaders around the world today can agree, it is the ever-growing importance

of innovation. The search for innovative solutions to the world’s myriad local,

national and global challenges has become a clarion call rallying people

Page 6: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 6 22 September 2007

across multiple borders defined by nation, industry, and academic discipline”

(Schwab & Hartigan, 2006).

Innovation is often introduced as an action in response to change.

Innovation in processes and products will, purportedly, enable organizations

to cope with increasingly diverse and increasingly individualized markets.

Innovation is a knowledge-based exercise, and fits snugly within the notion of

the Western progress towards a desired “knowledge society.” Do we need,

therefore, to become more innovative, more responsive to changes across

our entire ecosystem? Many believe so (Christensen, 2003; Cloke &

Goldsmith, 2003; DeMarco, Lesser, & Smith, 2006; Denning & Dunham,

2006; Drucker, 1985; Gladwell, 2002; Rogers, 2003; Sharma, 2006; von

Hippel, 2006). And, by extension, does “each of us” need to become

innovative within the frameworks of our own roles and responsibilities, as

Drucker suggests?

Leadership, I propose, envisions the future and illuminates its path. What

role does leadership play in our ability to become, “each of us,” more

innovative? Does the traditional model of “command and control”

accommodate the flexibility that innovation – especially in turbulent times –

requires? Or, does a more dynamic model of “pervasive leadership”

(Weisbord, 2004; Wheatley, 1999) lend itself more readily to success in these

transitional times?

Innovation and Leadership are widely discussed throughout the business

world. They have many definitions in and of themselves, already. What is

the motivation, then, to fuse these terms together? What is the value in

defining yet another aspect of these two concepts, by combining them?

This monograph purports to answer these questions by proffering operating

definitions of innovation and leadership, and generating value by leveraging

Page 7: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 7 22 September 2007

both to understand the nature of innovative climate and how leadership

principles affect it in a positive way.

Page 8: Monograph - Innovation Leadership

Monograph: Innovation Leadership

© Lawrence Hiner 8 22 September 2007

Chapter 2: Intersecting concepts used throughout th is monograph

Intersections are important. On the geographical plane, intersections are

where decisions are made as to direction and destination – decisions

involving tolerance for risk and ultimate goals. Intersections force us to

evaluate our priorities and our energies.

Intersections are where diverse cultures and ideas come together. It is

where potential accelerates. John Sutter, founder of Sacramento, California,

established his fort at the intersection of the Sacramento and American Rivers

in what was then Mexican territory. The fresh, cold waters of the American

River, fed by the snow melt of the Sierra Nevada, provided access to the

timberlands and fur-trapping regions of those mountains. The Sacramento

River ran from the north (all the way to Mt. Shasta in the Cascade Range)

and emptied further south into a delta region and, ultimately, across the Bay

to San Francisco and the trade routes of the Pacific Ocean. As fate would

have it, Sutter’s dream of an agricultural empire was eventually trampled by

the discovery of gold in the Sierra foothills during a routine lumber milling

operation leading to the “Rush” of 1849. However, the relevance of the

intersection was not lost on subsequent entrepreneurs. The resulting influx

of transiting miners and the commerce instantiated by the gold mining trade

mandated the infrastructure of supplies and wider trade routes, ultimately

leading to the burgeoning railroad industry with its western terminus (for

many years) in Sacramento.

The intersection of ideas is equally important as its topographical analogy.

Concepts that follow an isolated, linear path of development may have

enormous potential; however, that potential is customarily realized as that

idea intersects with others and accelerates into a solution that addresses real

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Monograph: Innovation Leadership

© Lawrence Hiner 9 22 September 2007

needs. This is one of the reasons that collaborative innovation has enjoyed

such demonstrated success, in that separately developed notions intersect in

an environment that nourishes the joined concepts into viable solutions

(Sharma, 2006; Tapscott & Williams, 2006).

Boru Douthwaite compared the evolution of innovations to the evolution of

species (Douthwaite, 2006). As ideas “live” and evolve, they encounter

stages similar to those identified at work in natural selection: “1) Novelty

generation; 2) Selection; and 3) Diffusion and promulgation” (p. 96). A basic

tenet of the evolutionary, natural selection model is the capacity for mutation

of the genetic structure that yields “Novelty generation” in the first place.

The recombination of the genetic structure takes place during the fertilization

process – in higher animals, the union of sperm and egg cells to form a

zygote – a definitive intersection event. Douthwaite also proposes that there

is a “Learning Selection Model” that iterates through the innovation

development and adoption process, resulting in the diffusion of innovations

that successfully surmount the evolutionary firewalls: “1) Experience; 2)

Making sense; and 3) Drawing conclusions; 4) Action" (pp. 96-8), and I’ll take

some liberty in extending this model by adding 5) Evaluating (or reflecting

on) the results. So, rather than relegating innovation to the vagaries of

genetic happenstance, it can be said that rational thought influences the

innovative process.

Except for Innovation and Leadership – key terms which will be discussed in

some detail later – this section offers some definitions for the concepts that

will be used throughout this monograph. Since many of these terms are used

in different settings by disparate authors with divergent meanings, I set out

here to provide my own perspective on them.

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Monograph: Innovation Leadership

© Lawrence Hiner 10 22 September 2007

Pre-modern, Modern, Post-modern

The terms, pre-modern, modern, and post-modern are used to describe

historical periods of philosophy and the arts (literature and architecture in

particular), but are also used as descriptors for eras of organizational styles.

Pre-modern refers to the command-and-control structure, wherein the top

leadership of the organization – usually one person – has the complete and

ultimate authority for the corporate vision as well as its execution. Pre-

modernism has its roots in the earliest days of our emergence from non-

societal animals into social creatures. Indeed, a pre-modern attitude of

acknowledging an Alpha leader and the lines of authority that stem from it

may be hard-wired into our collective psyche. Beyond this physical aspect,

certain savvy individuals may have learned along the way that invoking an

even greater authority (the elements, nature, God, or other iteration of the

unexplained) would trump even the Alpha leader. Eventually, entire

organizations took on the authority of physical and metaphysical power –

religions, armies, governments, aristocracies, and in due course, businesses

and corporations, leading to a “naturally occurring” (from a Darwinian

perspective) and “legitimate” (from a status quo viewpoint) command-and-

control power structure. Traditionally well-known magnates such as Carnegie

and Rockefeller fit this model, as do some of their recent, holdover

counterparts such as GE’s former CEO, Jack Welch, although their practices

also start to bridge into modernism.

Modern organizations are similar to their pre-modern predecessors in that

they are generally hierarchical in their authority structure, and that they are

generally led by an individual or small group, such as a board of directors or

executive team. The difference is that there is an innate operating

assumption that most (if not all) business parameters can be measured and

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Monograph: Innovation Leadership

© Lawrence Hiner 11 22 September 2007

can be controlled. Traditionally-educated MBAs are trained to use financial

accounting and other similar tools to provide these measurements in the

anticipation of employing business models to control productivity, revenue,

and, in the end, profit.

Both pre-modern and modern organizations – particularly those who are

established to make a profit – usually operate under the assumption that

McGregor’s Theory X is at work (as opposed to his Theory Y, described in

Weisbord 2004). Theory X states that most people are lazy, irresponsible,

passive, and dependent, and must have their work broken into tiny pieces,

tightly controlled, and supervised lest they make a mess of things.

Post-modern organizations, conversely, operate under the governance of

McGregor’s Theory Y, which states that most people will take responsibility,

care about their jobs, wish to grow and achieve, and, if given a chance, do

excellent work. A post-modern company relies on the assumption that all of

the workers are capable and even anxious to, as Jim Collins puts it, “ride the

bus” to collaborative success (Collins, 2001). That is, everyone understands,

agrees with, and works to accomplish the corporate goals, and may often be

part of the co-visioning process to establish and continuously reform the

organization’s projected horizon (Reynolds, 2007). Post-modern

organizations generally have flexible lines of reporting, that are established

ad hoc in response to immediate needs, and then re-worked to accommodate

the next set of circumstances. While authority exists (anarchy might

otherwise prevail), responsibility and accountability are distributed throughout

the levels of the organization, along with the rewards of success. Post-

modern workers invest themselves in the corporate mission and (to a great

degree) design and execute their roles to support that mission, in whatever

capacity the collaborative team deems appropriate. As Don Tapscott and

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Monograph: Innovation Leadership

© Lawrence Hiner 12 22 September 2007

Anthony Williams suggest, “While hierarchies are not vanishing, profound

changes in the nature of technology, demographics and the global economy

are giving rise to powerful new models of production based on community,

collaboration and self-organization rather than on hierarchy and control”

(Tapscott & Williams, 2006).

Google may be the best known contemporary example of a post-modern

company. During the expansion of the “internet bubble” in the 1990’s, there

were many highly-publicized reports of alternative business practices – casual

appearance, flexible work hours and locations, free food (especially high

calorie snacks and highly caffeinated beverages), child- and pet-friendly

environs, gentrified warehouse office space, lavish announcement parties,

and loads of alternative music piped through the corporate PA system.

Riding on the crest of that wave through the “bursting” in 2001, Google

wisened to the excesses of the bubble and sought to find a balance of post-

modern sensibilities with enough corporate structure to make it a viable

business. In a recent interview with Wired magazine, Google CEO Eric

Schmidt indicated that maintaining that balance is a constant struggle:

“Wired: Google’s revenue and employee head count have

tripled in the last two years. How do you keep from becoming too bureaucratic or too chaotic?

Schmidt: It’s a constant problem. We analyze this every day, and our conclusion is that the best model is still small teams running as fast as they can and tolerating a certain lack of

cohesion. Attempting to provide too much order dries out the creativity. What’s needed in a properly functioning corporation is a balance between creativity and order.” (Vogelstein, 2007)

As Schmidt infers, a post-modern approach is essential to sponsor a climate

of innovation that spawns the kind of creativity (and growth and revenue)

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Monograph: Innovation Leadership

© Lawrence Hiner 13 22 September 2007

that has come to be expected from Google and most, if not all, post-modern

companies.

A Talmudic proverb states, “We do not see things as they are. We see them

as we are.” An important aspect of post-modernism is this issue of

perspective – reality is not fixed but rather interpreted and constructed

through a social process. As Walter Truett Anderson frames it (Anderson,

1990):

“In recent decades we have passed, like Alice slipping through the looking glass, into a new world. This postmodern world looks and feels in many ways like the modern world that

preceded it: we still have the belief systems that gave form to the modern world, and indeed we also have remnants of many of the belief systems of premodern societies. If there is

anything we have plenty of, it is belief systems. But also we have something else: a growing suspicion that all belief systems

– all ideas about human reality – are social constructions.” (p. 3)

Innovation, then, looks very different in a postmodern world than it did

previously. In premodern times, the acknowledged experts were responsible

for the introduction of innovations, and even very good ideas were left by the

wayside if they were not derived from and driven through the sanctioned

channels (see Everett Rogers’ Diffusion of Innovations for a compelling

perspective on how this phenomenon impeded the now-obvious notion of

using citrus fruits to manage scurvy aboard sea-going vessels for over 150

years (Rogers, 2003)). Similarly, in modern times, the future – along with

everything else – was seen to be subject to laws and could thus be measured

and predicted; if just the right combination of traits could be applied, a

successful innovation would emerge. In a postmodern world, reality is being

constructed and negotiated as we go along. This is not a “predictable”

future, but one rife with possibilities. Individual consumers are modifying

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Monograph: Innovation Leadership

© Lawrence Hiner 14 22 September 2007

manufactured products (von Hippel, 2006) – sometimes even during the

manufacturing process1.

As C. K. Prahalad and Venkat Ramaswamy discuss the necessity of involving

the customer in the innovation process in The Future of Competition:

“Traditional business thinking starts with the premise that the firm creates value. Employees focus on the quality of the firm’s

products and processes, potentially enhanced through internal disciplines, such as Six Sigma and Total Quality Management.

Innovation involves technology, products and processes. Matching supply and demand has long been the bedrock of the value creation process. The co-creation experience depends

highly on individuals. Each person’s uniqueness affects the co-creation process as well as the co-creation experience. A firm cannot create anything of value without the engagement of

individuals. Co-creation supplants the exchange process.” (Prahalad & Ramaswamy, 2004)

Or, as William Taylor and Polly LaBarre succinctly state, “The big idea is that

top-down development is out; bottom-up, distributed community involvement

is the way to innovate your products and marketing concepts” (Taylor &

LaBarre, 2006). Patricia Seybold amplifies this thought, with a directive for

companies who want to repond well to this dynamic:

“Customers will innovate –– with or without your help –– to

create better ways to do things or to design products and

services that meet their specific needs. If you want to harness

the power of customers’ organic creativity, you need to support

their creative processes with tools, resources and imagination.”

(Seybold, 2006)

1 See http://www.rbkcustom.com to customize your own pair of Reebok athletic shoes.

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Monograph: Innovation Leadership

© Lawrence Hiner 15 22 September 2007

In order to be responsive to the turbulent changes in the postmodern

marketplace, companies will need to be agile. They will not have time to wait

for a premodern authority to conjure the future and create the next Model T.

They will not have time to engage in protracted modernist studies to predict

market trends and introduce the next iPod™. In the postmodern

environment, innovations in products and services need to be generated at

the point of service, and each employee is responsible for introducing

innovations as appropriate to meet customer needs and corporate objectives.

Appreciative Approach

There is a familiar English nursery rhyme:

Humpty Dumpty sat on a wall. Humpty Dumpty had a great fall. All the king's horses and all the king's men Couldn't put Humpty together again. (Anonymous, 1810)

Throughout my consulting career, I’ve often been involved in “Humpty

Dumpty” projects; viz., the customer has hired our team to act as “all the

king’s men” to “fix” some problem or issue. Often, these problems have been

as irascible as the shattered Mr. Dumpty, and all of the resources that were

potentially available could never set “things” right.

This “Humpty Dumpty” approach might be said to be using a deficit model;

i.e., one looks for the deficient or problematic elements of the current

operation, discovers what is “broken,” and proceeds to “fix” it.

Why does this occur? Might it have something to do with an industrialized

world wherein many machines exist to help us manage our daily tasks –

machines that are perfectly functional when they are first manufactured, but

then break down? And the way to return to a state of functionality is to

diagnose the malfunction and repair or replace the broken part?

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Monograph: Innovation Leadership

© Lawrence Hiner 16 22 September 2007

This deficit model of thinking has obviously made its way into the perspective

we take regarding our own bodies. The Allopathic Medical Model is a specific

approach to the diagnosis and treatment of illness:

The medical model also describes the approach to illness which is dominant in Western medicine. It aims to find medical treatments for diagnosed symptoms and syndromes and treats

the human body as a very complex mechanism…

The medical model drives research and theorizing about physical or psychological difficulties on a basis of causation and

remediation.

It can be contrasted with the holistic model of the alternative health movement and the social model of the Disability rights

movement, as well as to biopsychosocial and recovery model's [sic] of mental disorder. (Collaborative, 2007a)

Are business issues also, then, being perceived as results of machine-like

processes that are perfect in their design, but falter in their execution? Is it

the prevailing wisdom that the “fix” for this phenomenon is to diagnose the

occurrence of the operational deficiency and remediate it?

It would seem so. However, just as the medical model might be contrasted

with the holistic health model, the deficit model that is applied to

organizational issues may be contrasted with the appreciative approach.

In the mid-1980’s, David Cooperrider and his colleagues at Case Western

Reserve University introduced the notion of Appreciative Inquiry (Cooperrider,

1986; Hammond, 1998) as an innovative alternative to the deficit models and

practices of Change Management in vogue at the time (and still dominant

today). Essentially, Appreciative Inquiry:

…suggests that we look for what works within an organization. The tangible result of the inquiry process is a series of statements that describe where the organization wants to be,

based on the high moments of where they have been. Because

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Monograph: Innovation Leadership

© Lawrence Hiner 17 22 September 2007

the statements are grounded in real experience and history, people know how to repeat their success. (Hammond, p. 7)

This model relies on two factors that I am compelled to modify in my own

definition and use of the term appreciative in this monograph: 1)

Cooperrider’s method relies on the use of inquiry – the specific questioning of

the organization’s members to elicit memories of “high points” in their

collective history for replication; and 2) the notion that the way things were

successfully done in the past is worth emulating.

Regarding the first factor, inquiry, I believe that the interactive dialog with all

members of the organization that is represented by asking questions is vitally

important to any process that will result in innovation. In fact, pervasive

interaction among the social network is one of the key practices that I posit

as necessary for becoming an innovative organization. However, it is not the

sole procedure for responding to change, and so – on its own – is insufficient

for meeting this need.

With respect to the orientation towards past successes, it is certainly

reasonable to build upon those successes (rather than acquiring a deficit

orientation that focuses on blame, failures, and breakdowns). However, it is

once again insufficient, in my opinion, to solely look to historical examples of

successful behavior – which may or may not provide an adequate response to

the current situation that may require a novel, more innovative approach.

As a result, I would like to affirm the strengths of the Appreciative Inquiry

model and extend them into a more comprehensive Appreciative Approach.

This approach embraces the concepts of inquiry and building upon prior

success, but is more generic in its use of the appreciative idea. That is, the

Appreciative Approach begins with the notion of appreciation of the value of

the human element that each worker brings to the organization, and extends

the concept – beyond the inquiry into and specification of prior successes –

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Monograph: Innovation Leadership

© Lawrence Hiner 18 22 September 2007

into the active visioning process that results in well-defined, positive

objectives to build towards the evolution of a solution.

The Appreciative Approach, then, is in direct opposition to the Deficit

Approach. The deficit model identifies the malfunction of an existing system

in an attempt to repair the system “back” to its level of original functionality.

The appreciative model envisions a future state in which existing needs are

being met, as the ecosystem evolves to achieve those objectives.

The Appreciative Approach is one of the critical elements of innovation; that

relationship will be explored more extensively in a later section.

Turbulence

As the discussion of change – and especially the variable rates of change –

has become popular in business circles for the past few decades, the pundits

have latched onto an analogy from the realm of physical science to help in

the definition and description of change: turbulence.

“In fluid dynamics, turbulence or turbulent flow is a flow regime characterized by chaotic property changes. This includes

rapid variation of pressure and velocity in space and time.” (Collaborative, 2007b)

As early as 1967, it was observed and reported in the literature that different

systems within an organization function at different rates. Paul Lawrence and

Jay Lorsch studied six industrial companies and delineated some of these

structural anomalies (Lawrence & Lorsch, 1967). They noted that

departments within organizations were relatively adept at matching the rate

of transactions with their respective constituents, but were not integrated

with each other within the company. For instance, the marketing department

is likely attuned to the needs of the target audience for the company’s

products – including the rate of change of the customers’ needs – but

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Monograph: Innovation Leadership

© Lawrence Hiner 19 22 September 2007

marketing may not be in sync with the new product schedule that is pursued

by research and development. Further, both marketing and R&D are likely to

be asynchronous with production. While not described by Lawrence and

Lorsch in these specific terms, the dissonance between internal departments’

priorities and responsiveness rates can be seen as a direct contributor to

turbulence within the organization.

Stanley Gryskiewicz writes extensively on the topic of Positive Turbulence,

especially as an effect of disruptive energy on a static system (Gryskiewicz,

1999). He compares the impact of external factors on a relatively static

organization to the “collision of warm, moist air with cool, dry air,” creating

turbulent weather (p. 21). His premise is that these “disruptive” events are

often viewed negatively – demanding a Darwinian “adapt or die” response –

but may be welcomed as positive agents for meaningful transformation. The

relationship of this idea of positive turbulence and innovation is discussed in a

later section.

Note that the scientific notion of turbulence does not simply describe a

steadily increasing rate of change, as is often assumed in discussions of

changes in the business environment, but more completely reflects the fact

that change occurs at varying rates across all aspects of the milieu. Just as a

snowmelt-fed river flows at varying rates while making its inexorable way to

the ocean – forming pools, eddies, and rapids along the way – organizational

change occurs at varying rates.

Bill Bergquist and Agnes Mura expand the analogy of turbulence, as observed

in mountain streams, to describe its various aspects in 10 Themes and

Variations for Postmodern Leaders and Their Coaches (Bergquist & Mura,

2005). They define four components (or types of subsystems) that comprise

turbulence:

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Monograph: Innovation Leadership

© Lawrence Hiner 20 22 September 2007

• Rapidly flowing. This is the most commonly-imagined type of

turbulence, and the one which is used most frequently to describe

businesses that are attempting to navigate the needs of a rapidly-

changing marketplace. As product innovation migrates from the

research and development department to the consumer (see Von

Hippel, et al.), the pace of developing and releasing new products and

services into the marketplace accelerates to the point of creating

unique experiences for each consumer, on demand.

• Whirlpool: As a rapid flow encounters resistance in the form of rocks,

debris, and even other flows, certain portions began to slow in

response to the drag. These slower parts of the flow begin to form

pools, around which the faster streams of the flow begin to circulate,

forming eddies or whirlpools. In organizations, when an initiative

begins to encounter resistance in the form of resistant individuals,

unsupportive management, incompatible processes and procedures, or

other "rocks and debris," eddies and whirlpools in the workflow form.

In terms of innovation, noting the position and etiology of the

whirlpools is important in facilitating an innovative climate.

• Quiet pool: In river systems, quiet pools form as branches from the

main flow. As hikers, we are warned against drinking from these quiet

pools, favoring the clear water in the rapid flows. However, these

quiet pools serve an important purpose as the generative factory of

nutrients, such as blue-green algae, for the entire biosystem. In

organizations, these quiet pools may, at first glance, seem stagnant

and anti-productive; however, once their value is recognized, they may

be cultivated to provide nutrients for the rest of the company and its

vital initiatives.

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Monograph: Innovation Leadership

© Lawrence Hiner 21 22 September 2007

• Boundaries between the other three subsystems: As mentioned in the

previous discussion of whirlpools, there are places in the river where

different flow rates encounter each other, producing drag on the faster

and acceleration for the slower streams. In an organization, where

different rates of change and innovation occur, there is a similar effect

of slowing and accelerating. From a cultural perspective, it may be

interesting to observe how the various flows within an organization

impact each other; from a process standpoint, it may be where

integration may be facilitated for the benefit of all involved initiatives.

Turbulence is often associated with Chaos Theory, in that turbulence is

observed to be chaotic and unpredictable. However, as chaos theory teaches

us, what is apparently chaotic at one level of observation is simply part of a

larger pattern, when seen from a different perspective. In organizations,

what may seem to be chaotically turbulent could be part of an eminently

discernable pattern; and, while changes in the marketplace may not be

entirely predictable, they are both recognizable and manageable, with an

appropriate strategy.

Climate (vs. Culture)

The terms climate and culture are sometimes – mistakenly – used

interchangeably. Culture is an extremely broad, comprehensive topic.

“Culture,” claims Geert Hofstede, Emeritus Professor at Maastricht University,

“is more often a source of conflict than of synergy. Cultural differences are a

nuisance at best and often a disaster” (Hofstede, Pedersen, & Hofstede,

2002).

Fred Massarik and Marissa Pei-Carpenter, citing the 1963 work of Kroeber and

Kluckhohn, help to illuminate the complexity inherent in the notion of culture.

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"Frequently noting that culture is a ‘complex whole,’ the following sub-concepts are revealed in the comprehensive listing of definitions:

• Knowledge

• Belief

• Law

• Custom

• Acquired habits and capabilities

• Property

• Etiquette

• Industries

• Religious order

• Material objects and technique

• Tradition

• Instruments

• Buildings

• Things that people have

• Things that people do

• What people think.

This mélange of concepts, drawn from the work of a set of distinguished anthropologists and others, suggest both the strengths and weaknesses of the culture concept: It is very broad and complex and by its very comprehensiveness includes a vast agglomeration of detail." (Massarik & Pei-Carpenter, 2002)

In its vastness, it is clear that any effort to “change the culture” of an

organization would imply an enormous undertaking. The analysis phase,

alone, might consume an entire consulting firm – even if it were technically

feasible to capture, in any significant way, the depth of understanding that

would be necessary to design an effective intervention across all the

dimensions of an organization’s culture.

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Culture is deep, embedded, and reflective of core values. As T.S. Eliot

observed, “Culture cannot altogether be brought to consciousness; and the

culture of which we are wholly conscious is never the whole of culture: the

effective culture is that which is directing the activities of those who are

manipulating that which they call culture. (p. 184)” (Eliot, 1976)

Perhaps what Eliot called “effective culture” might also be seen as what we

now describe as climate. Climate, as juxtaposed to culture, can be defined

more narrowly. It is the thread whereas culture is the fabric. Climate can be

measured and manipulated – affected and changed. Using an analogy from

Personality Psychology to describe the relationship of culture to climate, Bill

Bergquist has observed that, “Culture is equivalent to personality, while

climate is equivalent to mood” (Bergquist, 2007).

In the setting of this monograph, the innovative climate is being addressed.

My assumption is that it can be directly viewed and measured, and that

interventions can be designed to enhance an organization’s climate of

innovation.

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Chapter 3: Innovation

What is innovation?

Innovation has a variety of definitions, depending on the perspective of the

one doing the defining. For instance, someone in the Research and

Development (R&D) department of an electronics manufacturer might view

innovation as the creative process required to respond to customer needs

with new product ideas. To someone in the banking industry, innovation may

mean a new process for customers to transact business using the bank’s

accounts, saving operational costs or generating additional revenue.

In the glossary of his definitive work on innovation, Diffusion of Innovations

(Rogers, 2003), Everett Rogers defines innovation as, “An idea, practice, or

object that is perceived as new by an individual or other unit of adoption” (p.

475). Now, this of course frames the innovation from the perspective of its

adoption – it is whatever is perceived as new by the adopter; but this

definition contributes the universal innovation concepts of “idea, practice, or

object,” novelty, and someone to adopt it.

We commonly acknowledge the terms, “practice” and “object” with the

services and products generated by innovative companies; the idea that an

“idea” may be an innovation is somewhat alien to our current use of the

term. However, Rogers began his investigations into innovation adoption in

the 1960’s as a sociological study; that is, he wanted to ascertain how new

ideas transmitted themselves across novice populations. The pervasive

concept that an innovation is actually a technological breakthrough is a more

recent development.

Robert Burgelman and Leonard Sayles (Burgelman & Sayles, 1986) define

innovation as, “a company’s efforts in instituting new methods of production

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and/or bringing new products or services to market” (p. 10), affirming the

prevailing notion that an idea must be realized in some fashion to be

considered an innovation.

Some authors have further defined innovation as being either incremental

(also called sustaining) or disruptive (Christensen, 2003; Christensen &

Raynor, 2003; Moore, 2005). An incremental innovation advances the

development of an existing product or service by extending its functionality

without changing its basic structure, function, or purpose. As Christensen

observes, “What all sustaining technologies have in common is that they

improve the performance of established products, along the dimensions of

performance that mainstream customers in major markets have historically

valued” (p. xviii). The new version upgrades to software (e.g., from 1.0 to

2.0) might be considered an example of incremental innovation. While the

basic function of the software is not changed, there are new features and

functions, and perhaps some inadequacies or outright defects have been

“fixed” in the new release.

A disruptive innovation, on the other hand, actually displaces the technology

that is currently in place – or discovers an entirely new niche in the

marketplace to either address existing market needs or establish new ones.

Moore (2005) states that, “This type of innovation creates new market

categories based on a discontinuous technology change or a disruptive

business model.” An example is the cellular telephone; it may be seen as

disruptive to pay phones (when was the last time you used one of those?)

and possibly to mobile radio (citizens band, amateur, and professional) as a

way to provide voice communications between individuals. Initially, the

disruptive technology will typically not perform well in the market, but will

eventually out-perform the existing technology it replaces, leading to

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Christensen’s Innovator’s Dilemma (Christensen, 2003) – whether to survive

on sustaining innovation or risk attempts to be disruptive.

In order to migrate from an observation of market needs to an actual product

or service, an innovation travels through various stages. Innovation may be

seen as:

1. a ideation activity, where new product or service ideas are generated;

or

2. the unique invention that results from that creativity; or

3. the instantiation process of actually constructing and prototyping the

innovation; or even

4. the adoption of an innovation by the targeted users.

The Continuum of Innovation

So, one way to define innovation is to examine the stages along what I term

the Continuum of Innovation:

Figure 1: Continuum of Innovation

As the various stages of this continuum are engaged, the notion of innovation

applies. During Ideation, the aspects of novelty and uniqueness are evident.

When actual Invention occurs, the creative ideas are realized in their earliest

prototypical forms. As Instantiation transpires, the innovation moves along

towards its commercial realization, and is modified by the prevailing needs of

the target market. The final stage in the Continuum of Innovation is

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Adoption. The adoption of an innovation instantiates what some see as the

necessary final stage in making it a commercial success (Davila, Epstein, &

Shelton, 2006) – without which “good ideas” never really mature to true

“innovations.”

Ideation

Often, these stages are perceived as isolated and complete definitions for the

whole continuum of innovation. As mentioned earlier, the Research and

Development department may view the Ideation stage as exclusively

definitive of innovation, with little regard to actualization or potential

commercialization of the product or service. However, ideation is often

brought about by the realization of customer wants and needs. As Hagen

Wenzek noted in an IBM Institute for Business Value report (Wenzek, 2006)

on the emergence of the consumer influence on innovation,

“Since the advent of information technology, the typical flow of innovation has been from the enterprise to the consumer… technology inspired innovation has now started flowing in the opposite direction, proving its worth with consumers first.” (p. 1)

Figure 2: Consumer impact on the innovation process

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Ideation, then, becomes a process identifying needs in the marketplace and

generating concepts for potential products and services to meet those needs.

As Gerard Gaynor notes,

“The ICI [Idea-Concept-Invention] stage involves a kind of controlled chaos, as those involved try to keep multiple thoughts in balance at one time, making the right decisions. This stage ends when an idea has been translated into a well-defined concept and proof of concept has been established — not just for the technologies involved, but also for the market and the system. The ICI stage is dedicated to activities that define the concept (and the technologies required to pull off the concept); knockouts (anything that might cause a “no-go” decision at some time in the future); market opportunities, customer base and needs; strategic fit; resources, infrastructure and confidence level; and deliverables.” (Gaynor, 2002)

The process of ideation that Gaynor defines responds directly to events in the

market. If the gating process that evaluates the potential for the concept is

successfully negotiated, the process flows immediately into the next stage of

the innovation continuum – invention.

Invention

While Rogers (2003) defines invention as, “the process by which a new idea

is discovered or created,” the contemporary notion of invention emphasizes

“discovery” less and “creation” more. That is, the approach to innovation

seems to rely on an active response to the market, as opposed to the

“discovery” of a valuable product or service that is simply waiting to be

discovered. There is a popular (but unreferenced) story that Thomas

Edison’s successful invention was not so much the light bulb itself but the

establishment of an infrastructure to deliver electricity to a wide area, which

promoted the adoption of the electric lamp to replace the fire-prone gas

lights. Here, we have creativity responding to a need in the marketplace. All

of which began with the vision of electric-powered lamps, followed by years

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of testing a plethora of various combinations of filaments and gases to

produce a workable model.

Invention, then, follows ideation as the process of developing the first

working prototype of the product or service. Edison’s first electric lamps were

invented on his workbench in New York, and were not initially in a form that

could be produced in sufficient quantity or quality to be distributed to the

general public. For this, another phase of development was necessary – that

which I term, instantiation.

Instantiation

James Brian Quinn states, “"Innovation is the first reduction to practice of an

idea in a culture” (James Bryan Quinn, 1988; James Brian Quinn, 1992).

While a “good idea” may occur to anyone thoughtful enough to be paying

attention, and while an engineering individual may eventually prototype the

idea into an invention, it is only when that invention – be it a product or

service – is crafted into a solution that is deliverable to the customer that it is

ready for adoption.

In their work in 2001 on examining practices in the healthcare industry for the

Institute of Medicine, Donaldson and Mohr leverage Quinn’s work (albeit from

the manufacturing industry) to define the “micro systems” of effort that are

required to deliver patient care.

"Quinn approached a study of business performance by

identifying breakthrough levels of successful performance in industries worldwide and asking how they accomplished it. Quinn found that many of the world’s best run organizations

recognized the advantage of focusing on small functioning units to improve timeliness and cycle time, product quality, service, customer and worker satisfaction, as well as to reduce

production costs. He described these small units as microunits of production, meaning that they were the smallest or minimum

“replicable unit,” which for this study means a unit whose

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processes are repeatable with small variation in response to local conditions and that have available to them all the

necessary resources to do their work.

Although the approach originated with routine manufacturing and rules-based, automatable systems, it proved to be

applicable, as well, to service operations where it led to large increases in customer satisfaction. Surprisingly, the larger the organization, the greater the leverage for gains [became]

because of a larger information database and greater possibility for experimentation.” (Donaldson & Mohr, 2001)

Here, Quinn has defined the crucible of instantiation – the “microunit” of

production where creative inventions are defined as products or services in

anticipation of testing in the internal or external marketplace. Interestingly,

Donaldson and Muhr also noted the postmodern aspects of Quinn’s work,

especially in that the business of innovation emanates from the point of

contact between the producer and the customer – not from the executive

suite of R&D:

“Using these small units as a starting place, Quinn found that

highly effective service technologies were connected in a variety of new organizational forms that seemed to have some common characteristics: they had much “flatter” hierarchies than their

predecessors; they were built around core service competencies typically consisting of special depth in some unique technologies, knowledge bases, skills, or other systems; and

they interacted with customers using excellent information technologies and organizational design. Organizations discovered that these forms also made their workplaces more

personally challenging and satisfying places to work."

Already, James Quinn had identified one of the basic tenets of Innovation

leadership – empowering the person or team responsible for the delivery of

the product or service to be able to entertain the risks and rewards of

innovation that will lead to more innovative behavior.

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Adoption

The diffusion of innovation has been realized as a sociological phenomenon

for some time. Rogers opens his own classic volume on the subject (Rogers,

2003) with a quote from Machiavelli’s, The Prince (1513):

“There is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage than the creation of a new order of things… Whenever his enemies have the ability to

attack the innovator, they do so with the passion of partisans, while the others defend him sluggishly, so that the innovator and his party alike are vulnerable.” (p. 1)

According to Rogers, diffusion is, “the process by which an innovation is

communicated through certain channels over time among the members of a

social system” (p. 11). Further, he defines adoption as, “a decision to make

full use of an innovation as the best course of action available.”

Rogers may have instituted the use of the “adoption curve,” which has

subsequently been used, modified, and referenced by dozens of researchers

and pundits who describe and expound on the adoption of innovation

(Burgelman & Sayles, 1986; Christensen, 2003; Christensen & Raynor, 2003;

Davila, Epstein, & Shelton, 2006; DeMarco, Lesser, & Smith, 2006; Denning &

Dunham, 2006; Donaldson & Mohr, 2001; Douthwaite, 2006; Drucker, 1985;

Gaynor, 2002; Gladwell, 2002; , Harvard Business Review on Innovation,

2001; McGregor, 2007; Moore, 2002, 2005; , People and innovation: Getting

ideas on the table, 2006; James Bryan Quinn, 1988; Sharma, 2006; von

Hippel, 2006; Wenzek, 2006). Essentially, the adoption curve indicates that

the rate of diffusion of an innovation across a population will happen over

time, and that it will begin slowly, accelerate more or less rapidly, and then

taper off slowly again. If you assume a normal distribution (bell curve)

phenomenon of the adoption of a new technology, it would look like this:

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0

2

4

6

8

10

12

14

1 4 9 17 27 38 50 62 73 83 91 96 99 100

Cumulative % Adoptions

Rat

e of

Ado

ptio

n

Figure 3: "Normal Curve" Adoption Rate

The normal curve indicates that the adoption begins slowly, accelerates to a

periodic adoption rate that peaks and then declines until all potential adopters

have been reached. At that point, there are no further adopters in that

identified market to purchase the product or service.

Rogers introduced a cumulative (or S-shaped) curve, so that the acceleration

of the rate of adoption became more graphically evident:

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Rates of Adoption

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1 2 3 4 5 6 7 8 9 10 11

Time

% A

dopt

ion

Slow

Medium

Fast

Figure 4: Rates of Adoption, using Rogers' curve

Note that I have included three separate curves, to demonstrate the visual

effect of fast, medium, and slow rates of adoption. The middle (red) curve is

one that is typically depicted as an adoption curve, starting very slowly (with

early adopters), then accelerating fairly quickly through the mainstream

adopters, and tapering off to something approaching – but never quite

reaching – 100% adoption. A faster rate of adoption is depicted by the first

(yellow) curve, which starts at the same point but accelerates much more

quickly to reach 95% adoption in about two-thirds the time of the medium

rate adoption. Finally, there is a slow rate of adoption, shown in the curve to

the right (in blue), that eventually reaches the same 95% adoption, but does

so in nearly twice the time as the medium rate. Given that there are

expenses associated with sales, marketing, production, support, etc., you can

see why companies are anxious to accelerate the rate of adoption to be as

fast as possible.

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However, as Machiavelli observed nearly 500 years ago, the attempt to

diffuse the innovation across a new population can be a frustrating

experience, as it is a decision-making process on the part of the adopters and

is completely under their control – regardless of the benefits or technical

quality of the innovation. Rudolf Diesel (1858-1913) seemed to agree with

Machiavelli, as he was paraphrased and quoted by Boru Douthwaite in a

recent article on Enabling Innovation (Douthwaite, 2006):

“Diesel… distinguished between two phases in technological progress: the conception and carrying out of the idea, which is a happy period of creative mental work in which technical

challenges are overcome and the introduction of the innovation, which is a 'struggle against stupidity and envy, apathy and evil, secret opposition and open conflict of interests, a horrible

period of struggle with man, a martyrdom even if success ensues.'" (p. 93)

Rogers speculated that there were five identifiable phases of adoption:

1. Knowledge of existing conditions into which the innovation would be introduced.

2. Persuasion, or the perceived characteristics and benefits of the innovation.

3. Decision of the adopter to try the innovation.

4. Implementation or the innovation to the adopter’s environment.

5. Confirmation that the innovation performed as expected and met the adopter’s perceived need.

Rogers perhaps coined the term “early adopter,” referring to the individuals

to whom the innovation first appealed, and who were willing to try the

technology despite the fact that it was untested by the masses. It is

interesting to note, when referring to early adopters, that those who eagerly

try out one technology are not necessarily those who will be first adopters for

a different technology, dispelling a common myth that there is a set of

characteristics that typify an early adopter (von Hippel, 2006).

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Geoffrey Moore has further refined the stages of adoption and the

characteristics common to each. In addition, he encountered what he termed

a “chasm” between the early and mainstream adopters – a place on the curve

where the rate of adoption paused and sometimes even stopped (Moore,

2002, 2005; Wiefels, 2002). The thought is that all of the potential early

adopters have accommodated the new technology, and yet the appeal to the

mainstream users has not been clearly identified. The “bridge” across this

chasm is to generate interest – not based on the novelty that appeals to early

adopters – but on the practicality of how the innovation will result in actual

gains in productivity, interest, entertainment, or whatever value the adopter

might perceive.

As the industry interest in innovation continues to escalate, so does the

emphasis on adoption. As we have already seen graphically demonstrated

via Rogers’ S-curves, the faster the adoption, the more rapidly the return on

investment is realized. This emphasis on adoption has thus spawned an

entire library of books and articles that cite innovation as the main topic, with

some even alluding to the work of Rogers, Moore, Christensen, and others in

an effort to focus on the rate of adoption as a measure of innovation success,

or on creativity as the single point of innovation germination (Amabile,

Hadley, & Kramer, 2003; Brown, 2003; Chesbrough, 2003; Christensen,

Anthony, & Roth, 2004; Coburn, 2006; Craumer, 2003; Davila, Epstein, &

Shelton, 2006; Drucker, 1985, 2003; Lester & Piore, 2004; Levitt, 2003;

Peebles, 2003; Tuomi, 2002; Tushman & O'Reilly, 2002; von Oech, 1998;

Wolpert, 2003). However, I believe that one of the most important lessons

learned from studying innovation is that the rate of creativity or the rate of

adoption is merely a symptom of the entire continuum of innovation. Trying

to manage creativity or adoption is like treating symptoms instead of the

disease; as in the case of infection, treating a fever with an ice bath instead

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of antibiotics. In my review of the literature, it is apparent that the entire

continuum of innovation needs to be addressed when attempting to manage

innovation.

Innovation Management

IBM periodically takes on the task of surveying hundreds of CEO’s (and,

separately, CIO’s) to help determine and report on the trends across

industries, across the globe. The most recent CEO study concentrated almost

exclusively on innovation as a major emerging theme among the leaders of

some of the most influential and successful companies in the world. Among

the primary findings was the migration of considering innovation as purely an

exercise in invention to the infusion of an innovative approach across the

organization. In this regard, a synopsis of the CEO’s suggestions yielded the

following recommendations (IBM, 2006):

• “Think broadly act personally and manage the innovation

mix - Create and manage a broad mix of innovation that emphasizes business model change.

• Make your business model deeply different - Find ways to substantially change how you add value in your current

industry or in another.

• Ignite innovation through business and technology

integration - Use technology as an innovation catalyst by combining it with business and market insights.

• Defy collaboration limits - Collaborate on a massive,

geography-defying scale to open a world of possibilities.

• Force an outside look… every time - Push the organization to

work with outsiders more, making it first systematic and, then, part of your culture.” (p. 3)

This is obviously not an agenda for simply generating ideation, improving

invention, increasing instantiation, or accelerating adoption – it is a mandate

for integrating innovation into every aspect of the business. As Thomas

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Kuczmarski puts it (Kuczmarski, 1995), “Innovation is a mindset. Though you

can’t touch it, smell it, hear it, see it, or taste it, you can sense, think, and

feel innovation. Innovation is best described as a pervasive attitude that

allows businesses to see beyond the present and create a future vision” (p.

3).

How does one, then, attempt to establish and manage a pervasive innovation

mission and climate that fosters the fulfillment of the business’ future vision?

Bettina von Stamm and her colleagues at the London Business School have

spent the last several years attempting to answer just that question. In The

Innovation Wave (von Stamm, 2003a), she states, “There is no one right way

of infusing innovation into an organisation, it will depend on the company’s

specific context, including company size, what kind of innovation is sought,

and which stage in the innovation journey the organisation is at” (p. 123).

However, there are guidelines – with specific objectives – that can be

followed, based on the experiences of successfully innovative companies:

“Addressing the challenges associated with innovation necessitates a holistic approach that realises the importance of

considering context and the need for aligning all aspects of an organisation to the innovation goal. The five key areas where innovative organisations do something differently from their less

innovative counterparts are:

• strategy and vision

• leadership

• culture [viz., “climate”]

• processes

• (physical) work environment” (p. 3)

As with most approaches that are declared to be “holistic,” it is an intentional

blending of all of the elements that produce the desired result – in this case,

innovation. Without aligning “strategy and vision” with ideation and

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invention, for instance, innovators may generate a whole host of novel

product and services concepts, but have no ability to execute and bring them

to market – especially if they don’t correspond to the core competencies of

the company. In this light, aligning innovators’ thinking with the

organization’s strategy and vision will likely result in more efficient

expenditure of innovator ideation and invention cycles. This drive towards

alignment with corporate strategy and vision must be balanced with a

penchant for “out of the box” thinking, so that ideas don’t always result in

“me too,” incremental innovations while ignoring disruptive possibilities. As

Tony Davila, Marc Epstein, and Robert Shelton suggest in Making Innovation

Work (Davila, Epstein, & Shelton, 2006), “Manage the natural tension

between creativity and value capture… Creativity without the ability to

translate it into profits… can be fun but it is unsustainable; profits without

creativity is rewarding but only works in the short term” (p. 11).

Continuing with von Stamm’s recommendations, leadership – as it relates to

innovation – is the one of the key concepts of this monograph. Leadership

can be framed in terms of the named management of the company, from the

C-level to the line management. In this light, Davila et al recommend the

following responsibilities for a “Chief Innovation Officer,” who is sometimes

also the CEO:

• “Provide a long-term view for innovation via the innovation strategy and

portfolio.

• Sensitize key leaders and managers to the dynamics of innovation.

• Nurture key creation projects.

• Manage relationships with external partners.

• Assess innovation implications of corporate, strategic initiatives.

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• Provide expert opinion and crucial judgment.

• Manage the balance between business and technology innovation, such as

organizational dynamics, portfolio, resources and processes.” (p. 114)

Leadership can also, as described more fully later in this document, be

discovered and developed pervasively throughout the organization (Raelin,

2003; Weisbord, 2004). While some of the responsibilities suggested by

Davila et al, above, require the perspective of the C-suite (e.g., balancing

resources in support of pervasive innovation), most of them can be

accomplished by line-level employees working on specific innovation

initiatives. This dynamic will be explored later.

The third guideline enumerated by von Stamm has to do with the

management of the innovation culture (we will call it, “climate” as per the

previous discussion). As part of the Innovation Management process, the

innovation climate regulates the organizational tolerance to ideation,

invention, and instantiation efforts. Since all of these require significant

investment of worker time and other resources, it is important to foster a

positive innovation climate, so that the expenditure is well-received (from a

process standpoint) and well-rewarded (from a personal perspective).

Assessing and enhancing the innovation climate is the subject of the next

section, and will be further explored there.

The fourth area suggested by von Stamm as relevant to managing innovation

is process. In order for innovations to proceed from ideation to invention and

instantiation, the processes must be in place to support those transitions. As

a case in point, I have been witness to the developing instantiation of a good

idea to manage one aspect of innovation at IBM. In the timeframe of 2004-

2005, a process and a tool to support it was invented at IBM to solicit,

capture and assess good ideas from throughout the 320,000+ global

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employees. The concept was elegant in its directness: a database would be

created to store ideas for product, process, and services innovations (both

internal and customer-oriented), so that IBMers would have a single

repository for these ideas. An intranet front-end was also implemented for

the peer and executive review of the innovations for selection and potential

implementation. The program was called, “ThinkPlace,” in reference to IBM

founder Thomas Watson’s one-word admonition to all employees: “Think2.”

As described on the IBM intranet,

“ThinkPlace is an innovation ecosystem that enables IBM’s value

related to innovation. It is comprised of a world-class idea generation and refinements application, and a network of the most innovative minds in our company – and in the world. This

program is designed to gain competitive advantage by leveraging IBMers’ creativity and collective expertise into tangible actions which can improve every aspect of our

products, services, workplace, and company. ThinkPlace enables every IBMer around the world to be an

innovator by providing a common forum for sharing, refining and recognizing ideas.

Through ThinkPlace, IBMers can collaborate to:

• Surface opportunities to grow our business.

2 When Thomas J. Watson joins the Computer-Tabulating Recording Company - the forerunner of today's IBM - in 1914, he brings with him the "Think" motto he coined when he

managed the sales and advertising departments at the National Cash Register Company. "Thought," he says, "has been the father of every advance since time began. 'I didn't think' has cost the world millions of dollars." Soon, the one-word slogan "THINK" appears in large

block-letter signs in offices and plants throughout the company. In 1915, Watson was quoted in an audio broadcast to IBM employees as saying, “And we must study through reading, listening, discussing, observing and thinking. We must not neglect any one of those

ways of study. The trouble with most of us is that we fall down on the latter - thinking - because it's hard work for people to think, And, as Dr. Nicholas Murray Butler said recently, 'all of the problems of the world could be settled easily if men were only willing to think.'” Hence, the IBM laptop was called the ThinkPad in reference to its manual predecessor – an

ubiquitous 3x5” paper notepad with the word “THINK” inscribed into its leather cover.

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• Identify solutions for critical client and business needs.

• Offer improvements for existing problems or internal inhibitors.

• Suggest changes to improve our culture and succeed in our jobs.” (IBM, 2007b)

However, within a few months of its launch and subsequent internal

marketing, ThinkPlace was challenged with the sheer volume of employee-

generated ideas. There was no issue with the technology – the system

worked flawlessly to record each idea. The process of reviewing and

evaluating the ideas, however, was strained beyond capacity. Volunteer peer

reviewers, called Catalysts (I was one) were to monitor and evaluate ideas,

with the objective of selecting one or more to assist in taking the idea to

invention and instantiation. The deluge of ideas, which ranged in scope from

incrementally simple to disruptively complex, was more than the dozens of

volunteer Catalysts (who also had their regular full-time duties to perform)

could reasonably handle. Of the tens of thousands of ideas that had been

posted in ThinkPlace, only a small percentage were able to be evaluated or

taken towards invention, instantiation, or adoption. Unintentionally, then,

most contributors received little or no peer or executive feedback on their

ideas during the initial rollout of ThinkPlace.

Over the past two years, additional processes have been established to give

contributors more focus in the intent of the ideas, aligning them with

corporate strategy via “Executive Challenges.” Also, procedural and

technological linkages to related ideation, invention, and instantiation efforts

throughout the company have enabled the ThinkPlace program to more

successfully accommodate the contributions of talented and generous IBM

employees, demonstrating the significance of process to the management of

innovation.

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Lastly, von Stamm cites the work environment, especially physical work

spaces that support collaboration and information flow, as a key differentiator

for organizations recognized for being innovative. While I can certainly

understand that the work environment is a contributor to innovation, I see it

as less of an independent factor than perhaps a reflection of a positive

innovative climate. That is, people who are in a positive climate for

innovation find ways to both overcome barriers and create work spaces that

support the processes and activities that contribute to innovation.

Establishing an innovation-oriented physical environment does not, by itself,

contribute to enhanced innovation. There are many heavily matrixed,

globally mobile companies relying on networks of leading innovators in their

respective industries, which further diminishes the idea that physical work

environments impact innovation. As Ronald S. Jonash and Tom Sommerlatte

state,

“Innovation networks are the arms, legs, eyes and ears of the

next-generation organization. They involve people from

different hierarchical levels in your company, each of whom is

accountable to contribute a critical capability so that the

network as a whole reflects the organization’s insight and

experience.” (Jonash & Sommerlatte, 1999)

In short, I propose that an innovation-adjusted physical work place is more a

by-product than a cause of a positive climate of innovation.

Innovative climate

As previously discussed in this document, it is the climate of innovation that

will be explored here, as opposed to the culture within which innovation may

occur. In this context I’m positioning climate as a tangible that can be

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intentionally influenced, whereas culture is indicative of core values and

closely held beliefs that are more difficult to modify.

A 2006 IBM world-wide study of 750 CEOs indicated that the most significant

inhibitor to innovation is “unsupportive culture and climate” (IBM, 2006). In

a subsequent customer presentation (IBM, 2007a), a “Climate for

Innovation3” is defined as, “A working environment where inspiration thrives

and creativity flourishes.” Further specifying that work environment, the

authors go on to enumerate the characteristics of the people who comprise

that working environment:

• Intellectual curiosity

• Scan for trends & risks

• Accept accountability for results

• Responsible risk taking

• Decisive (Acts/reacts with speed)

• Complex thinking to predict & act

• Comfortable with ambiguity

• Creativity skills

• Innovation in action

• Critical Thinking

• Global/broad perspective, short & long term thinking

• Ability to follow through to completion

• Conflict resolution & mediation

• Conviction to challenge boundaries

• Collaboration skills - developing productive relationships

• Seeks best solution

3 The actual IBM presentation uses “culture,” “climate,” and “culture/climate” interchangeably. For consistency, and in keeping with the discussion elsewhere this

document regarding climate vs. culture, I will only use the term, climate.

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• Act local, think global

• Intelligent risk taking

• Proactive decision making

• Open mindedness

• Curiosity & inventiveness

• Mistake tolerance

• Willingness to learn and grow rapidly

• Co-operative, collegiate and inclusive

• Flexible in practices

• Manages/seeks diverse perspectives

• Emotional maturity to deal with and manage change

In an effort to define an approach to modifying the innovation climate, the

IBM team synthesized the list of characteristics to define six areas of focus for

designing an intervention:

“IBM has identified the organisational4 levers that are most

likely to provide the greatest opportunities for successfully

driving change towards a more innovative and collaborative

culture.

• Vision, Strategy & Alignment - defining a clear

ambition and organisational agenda for innovation.

Ensuring that the innovation strategy aligns individual -

team - organisational and market across a set of

innovation values with clear ownership for innovation

• Leadership (for innovation) - establishing the right

blend of leadership styles and mindset that ensures the

4 The work effort for this concept was performed in the UK; the native spelling of

“organisation” is preserved in the quoted reference.

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organisation is capable of dealing with the inherent

tensions associated with innovation and creativity as

defined in ‘managing the AND’ (see slide 47) [This refers

to another part of the presentation where Opportunity for

innovation AND the Discipline to deliver on that

opportunity were posited as necessary for successful

innovation].

• Collaboration - employing mechanisms that promote

collaboration within the organisation and with external

participants. Establishing a collaborative mindset and

practices that embrace and thrive on diverse

perspectives. Use technology to connect formal and

informal groups and provide opportunities for individuals

to contribute in a creative manner.

• Diverse constituents - ensuring a richness of team

members to encourage diverse perspectives that can

drive creativity through tension.

• Freedom (and opportunity) - Ensure that individuals

have the ‘freedom’ to innovative within a defined

framework that provides accessible innovation expertise.

Ensure that policies, processes and systems do not inhibit

innovation.

• Engagement - ensure that leaders and employees are

engaged through a common vision and values. Provide

appropriate incentives, reward and recognition for the

contributions that individuals make to the organisation’s

innovation effort.

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• Skills and Mindset - Establish an innovation mindset

that encourages risk taking, entrepreneurial approach,

trust and permission to fail. Ensure people have the skills

and capabilities to manage the ‘AND’.” (pp. 49-50)

“Vision” is integral to the innovative climate in that the ideation process

needs to be aligned with the core competencies and strategic execution of

the company in order to be invented and instantiated successfully. While

innovation may lead to new market areas for the company to pursue,

incremental – and even disruptive – innovative ideas will usually be more

readily accomplished within the general boundaries drawn by the strategic

vision.

“Leadership” is, of course, the intersecting concept with innovation as a thesis

for this monograph. In this context, the authors are looking at management

efforts to help maintain the tension that is inherent in trying to be creative,

yet focussed on outcomes. As with the vision discussion, keeping ideation

aligned with corporate goals while encouraging novel responses to turbulence

is a matter for leadership at all levels of the organization. The tenor for how

this will be accomplished is usually set by the identified leaders – the

occupants of the C-suite and their managerial reports.

“Collaboration” is mentioned here in its first iteration in this monograph. It is

often overlooked in the literature on innovation, which retains the fantastical

notion of the independent inventor from the legends of folk heroes like

Thomas Edison and James Watt. The post-modern observation is that

innovation occurs in an intensely collaborative environment, where teams are

working on their responses to changes in the market – not just individuals.

While this dynamic certainly makes room for individual contributions, it relies

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on the multiple talents of the entire team to ideate, invent, and instantiate

meaningful innovations. This leads to the next point, “Diversity.”

“Diversity” is a key component for innovation. This tenet has been known

and implemented for ages. Innovation during the Renaissance in Europe

was, in part, due to the diversity of ideas that erupted from the network of

nation-states that developed during the Dark Ages; during this same period in

China, the ubiquity of Confucianism may have contributed to a “oneness of

mind” that suppressed the diversity aspect of innovation. While I was at the

Johns Hopkins University in Baltimore as a student and instructor during the

1980’s, it was standing policy to never hire its own graduates into tenure

track faculty positions, opting for the diversity of “new blood” from other

schools to fill those key positions. These examples acknowledge the role of

diversity in innovation. In a proactive way, organizations are encouraged to

seek members with a variety of backgrounds, approaches, and opinions to

work collaboratively on innovation projects, pulling in the energy of diversity

from what Gryskiewicz calls, “the fringe” (Gryskiewicz, 1999).

“Freedom” to innovate is expressed in both negative and positive ways. From

the negative standpoint, when potential innovators are encumbered by

organizational constraints – say, an overly risk-averse administration that

actively punishes failure – they will likely not venture attempts to ideate or

invent “outside the box.” This will result in incremental improvements to in-

flight products and services, but will not generate disruptive ideas that are

inherently unproven and take time to mature into revenue producers.

Freedom, in this context, would be the suspension or removal of those

constraints. From a positive perspective, freedom is the encouragement to

experiment, and even to fail as a necessary part of discovering success. In

addition, positive freedom engenders a spirit of innovation throughout the

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organization, provides access to human and technological resources to pursue

invention and instantiation, and rewards innovative efforts (whether or not

the product or service is a commercial success). “Thomas Watson, Jr., of

IBM had the right approach to risk. He once said, while discussing IBM’s

competitive challenges, ‘We don’t have enough people out there making

mistakes.’” (Hesselbein, Goldsmith, & Beckhard, 1996).

“Engagement,” as used here, entwines vision and leadership. It is the

process of aligning innovative thinking with corporate goals, and sets up the

processes to reward those whose innovations support those objectives.

“Skills and mindset” represents the iteration of engagement at the individual

level – as the individual starts to “own” the capability to innovate and is

accountable to corporate goals, with the risk of failure minimized – viz., not

the level of risk, but potentially negative results of “failure.” Both of these

concepts – “engagement” and “skills and mindset” – are not necessarily

exclusive characteristics of an innovative climate, but do contribute to its

overall definition.

Another IBM effort – also subsequent to the 2006 CEO study, and reported in

the Institute for Business Value’s publication, People and Innovation

(DeMarco, Lesser, & Smith, 2006) – provides perhaps an even more direct

approach to the development of an innovative climate in an organization.

The authors recommend a two stage process: Setting the stage and Taking

action:

“Stage one: Setting the stage for innovation

• Paint a picture for your people that provides strategic

context, both giving direction and setting boundaries for

innovation.

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• Stamp out fear by creating a culture that embraces risk

and eliminates the stigma associated with failure.

• Encourage diversity: Value and leverage the ideas

residing within the diverse cadre of your employees.

Stage two: Taking action

• Connect the dots within your organization by

understanding and leveraging the informal networks that

can improve innovation effectiveness.

• Reach outside: Collaborate with external organizations,

including partners and suppliers, and with customers to

complement existing competitive advantages, speed up

time to market, or spark new insights.

• Make ideas visible using a variety of practices designed

to elevate ideas from all corners of the organization.

• Motivate for results: Provide incentives and recognize

your people’s innovativeness through programs that

carefully complement both the passions that drive

employees and a well-crafted organizational vision.” (p.

4)

These recommendations are in keeping with those that have been presented

elsewhere in this monograph. “Painting a picture” denotes sharing the vision

with potential innovators throughout the organization. “Stamp out fear”

helps to eliminate the risk of failure during ideation and invention.

“Encourage diversity” uses the energy from the edge of turbulence. “Connect

the dots” leverages the processes and networks inherent in the organization

to create opportunities for ideation and complete the invention and

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instantiation cycles. “Reach outside” is the external version of “Encourage

diversity,” to bring in new concepts and ideas from as many sources as

possible. “Make ideas visible” is an effort to reach pervasively across the

organization to encourage innovation in all aspects of the corporate work.

And, finally, “Providing incentives” demonstrates appreciation to innovators

for their efforts.

Several strong themes have been developed in this discussion of innovation.

To create a successful innovation climate, the concepts of organizational

vision, tolerance of risk, incorporating energy from the various aspects of

turbulence, and rewarding and efficient processes must all be in place and

functioning well. These functions have traditionally fallen to the named

leadership of the organization – management. In the subsequent section on

Leadership, the case will be made for the integration of leaderly behaviour

into all levels of the organization to promote a pervasively innovative climate.

Operational Definition

For the purpose of discussion in relation to Innovation Leadership, innovation

is defined as “the appreciative adaptation to turbulence.” What does that

mean?

Appreciative

As previously mentioned, the notion of Appreciative Inquiry comes from the

work of Cooperrider and others (Cooperrider, 1986; Hammond, 1998). While

this is yet another important aspect in the development towards a climate of

innovation – in that individuals need to define and focus on positive, goal-

oriented objectives – it is somewhat limited as a universal component of

pervasive innovation. That is, the inherent supposition in Appreciative

Inquiry (identifying and replicating successful prior behaviors) does not

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accommodate the creative visioning process that is needed to create and

sustain a climate of innovation.

My mentor and colleague, Bill Bergquist refers to the three common uses of

the term appreciation: “We appreciate other people through attempting to

understand them. We also appreciate other people through valuing them and

often seeing them in a new light. A third way of appreciating another person

is by being thoughtful and considerate in acknowledging their contributions to

the organization.” He goes on to describe the ways in which the common

understanding of appreciation has been extended to application in

organizations:

“The term appreciation is now being used with regard to not

only individuals but also organizational settings, and have [sic] become more closely aligned with shifts in organizational attitude. There are three ways in which the attitude of

appreciation is exhibited in an organization. An organization is considered to be appreciative if one finds a positive image of the future within an organization, especially if this image infuses

strategic planning in the organization with meaning and purpose. The organization is also appreciative if a concerted effort is being made to recognize the distinct strengths and

potentials of people working within the organization. Finally, an organization is appreciative if its employees consistently value and seek to establish cooperative relationships and recognize

the mutual benefits that can be derived from this cooperation.” (Bergquist, 2003)

The transition of appreciation from an interpersonal to an organizational

process is indeed important in the development of a post-modern company.

Without an appreciation for the individual worker as the essential

organizational component, the organization will fall into modern or pre-

modern leadership practices, obviating any sense of pervasive innovation.

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Adaptation

In practice, it means that the adaptation is not a knee-jerk reaction of

retreating to old habits in the face of change, but that change – and its

variations known as turbulence (Bergquist & Mura, 2005) – is embraced as a

factor and motivator in the innovative process, leading to pro-active plans for

its repercussions.

As Peter Drucker has iterated over the last few decades (and others have

echoed and elaborated), post-modern businesses are based on an

information economy, especially in the United States and the “Western world”

(Drucker, 1985, 1994, 2003; Leadbeater, 2000). Where once the produce of

the land - and then the products of invention - governed the revenue

generation of the economy, new product concepts (manufactured elsewhere)

and new services ideas are now at the forefront of economic growth. Even

computer software – one of the hallmark products of the information

economy – is often conceived and designed for specific customer

requirements in the U.S. and then coded to completion by programmers in

China, India, Eastern Europe, and states of the former Soviet Union

(Friedman, 2005).

In an information economy, ideas rule. As Charles Leadbeater observes,

“Knowledge capitalism is the drive to generate new ideas and

commercialize them. This process of creating, disseminating and exploiting new knowledge is the dynamo behind rising living standards and economic growth. Collaboration is the driving

force behind the creativity reflected in knowledge capitalism.” (Leadbeater, 2000)

Being able to generate these ideas is a defining aspect of innovation. In my

operating definition of innovation, the ability to adapt to turbulence in the

market is significant.

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Turbulence

J. Peter Duncan uses the concept of turbulence to describe the possible

responses to the changing needs of the market (Duncan, 2004):

“Everyday your rivals try to offer something better that will attract more customers to their services or products. Everyday you try to hold

them off. You hope your offerings are better, but that can only last so long. Eventually competitors can find a way to surpass your current offerings unless you innovate and further raise the challenges they

must overcome.

It's a Darwinian game where the victors are allowed to continue on to innovate again and move their industries forward. For the losers,

irrelevance, obsolescence and ultimately business failure is all too common a fate. If you were to examine the Fortune 500 list from 1955 (the first year it was published) there would be some companies that

you would recognize, but many more (well over 25% of the list) that went the way of the dinosaurs and became extinct, dying of changes

in their environment or being gobbled up by more aggressive carnivores. This is frequently the fate of the largest organizations in the business world, and the challenge for survival is even greater for

the small and midsized companies.

To survive, a company must be aware of its environment and alert to change. Change - it is everywhere. It is the current of business,

sweeping over all like a flooding river. When it rages, it is frightening: bumping, bruising and even drowning those with its power. When it is calm, change is tolerable, and we build structures - systems, models

and policies - that try to control and resist it. If we get a good thing going, instinct tells us to lock in the gains - to keep doing more of the same to capitalize on our success. But it is a fine line between

capitalizing on success, and getting stuck in a rut while clinging to a dream of a past when business was easier.

But there are companies that get tired of clinging and embrace

change. They prefer the adventure of moving with the current of business over clinging and dying of boredom. Letting go, they embark

on a voyage into an unknown future where they are often tumbled and smashed into unknown obstacles. For some it is too much and they stop and cling again. But for those who refuse to hold on, they soar

with the currents appearing to magically fly above those who try to resist the current of change.” (pp. 8-9)

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In this bold narrative, Duncan infers the various subsystems that are

described by Bill Bergquist and Agnes Mura (referenced in the earlier

description of turbulence in this document). In turbulence, there are rapids,

whirlpools, places of calm, and the edges among them. As organizations –

and the individuals comprising them – navigate the turbulence, they may

choose to attempt to exert control over the market forces; or, as Duncan

suggests, they might “go with the flow” and ride the currents of energy. In

this way, he implies, companies can respond (adapt) to the varying rates of

change (turbulence) by successfully generating new products and services

that are in keeping with the changing market.

Whitewater rafting, though, is inherently risky. Part of the adrenalin rush

from the experience, I imagine, is due to recognizing that risk, embracing it,

and successfully maneuvering and living through it. While I am sure that the

professional whitewater tour guides take every precaution to ensure against

major injury, it still happens. Similarly, “letting go” and riding the market

rapids is not a job for the risk-averse among us. Standing securely on the

shoreline or staying in the calmer side channels would be much safer – but

also much less rewarding.

Innovation is a risky business. That is, an innovative organization must be

willing to tolerate a certain level of failure along with success. Those who

attempt to mitigate against failure from the outset – viz., a zero tolerance

policy – will set up a situation which punishes anything but staying within a

pre-defined “safe zone” of incremental improvements to the status quo, and

precludes the opportunity of a breakthrough product or service.

So, why should turbulence be embraced instead of simply resisting it? As

Stanley Gryskiewicz expounds on the positive influences of turbulence on an

organization that embraces it:

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“Positive Turbulence is a paradoxical process: you invite an energizing, disparate, invigorating, unpredictable force into your

organization so that you can use its chaotic energy and direct it toward continuous renewal. You create an environment that upsets the status quo and impels people toward change.” (p.

21)

Although this statement employs circular reasoning, by definition, turbulence

is a state of change; so, inviting change to impel change is really self-

defining. Gryskiewicz goes on to clarify the relationship between turbulence

and innovation by stating,

“When different ideas are brought into an organization or new

information is presented, there could be as many different ways of viewing it as there are individuals looking at it. Then again, there could be just one way - the company way, the way such

ideas and information have always been viewed, a way not likely to uncover new directions or new processes needed for renewal. The many ways of viewing the ideas may well lead to

renewal because the more possible viewpoints there are, the greater the likelihood is that one will lead to the appropriate interpretation on which people can act in positive new ways.

The reason that multiple perspectives are so critical is that Positive Turbulence depends on making sense of new and different information that by its nature is not fully clear. It is by

taking the low-frequency, low-amplitude, static-filled signals from the periphery, examining them from different angles, and interpreting them in fresh ways that we are able to amplify

them into something useful. It enables us to see solutions in a different light, act in unanticipated ways, and uncover new

possibilities.” (p. 24)

In this way, turbulence spawns innovation by offering new perspectives.

Turbulence gathers viewpoints and ideas from the periphery and deep

beneath the surface – places where the central stream may not travel – and

introduces them to the main organization. In this way, new answers to

business needs can be explored and developed. For instance, the turbulence

caused by the fragmentation of identifiably large market segments into micro

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and individual markets has carried the needs of the consumer directly to

manufacturing, where a connection had not previously existed (von Hippel,

2006).

Gryskiewicz emphasizes this relationship by observing:

“Inviting multiple perspectives is a central part of organizational change. It is the way that forward-thinking leaders can gently

coax (or violently wrench, if that is what is needed) their organization out of its traditional perspective. The sparks that

come about when old frameworks scrape against new perspectives ignite creativity.” (p. 27)

In this analogy, it is actually the dynamic intersection of new ideas that not

only produce a single new idea, but also generates a cascade of new

approaches for decision making and problem solving throughout the

organization. He concludes this line of thinking by charging identified

leadership with the responsibility to introduce Positive Turbulence, in the

same fashion that other executive decisions are imposed.

“Business leaders can impose a reorganization on a company.

They can impose a dress code. They can also impose Positive Turbulence, but unless they have taken care to develop receptivity to this process, it runs the risk of failure. If

employees do not learn to value and use Positive Turbulence, all that energy will just dissipate or, worse, cause disarray.

Receptivity to anything is in large degree a function of one's

sensitivities and sensibilities, so the different styles that individuals have impinge on how they adapt to and work with

Positive Turbulence. People may differ in their style of defining a problem and finding creative solutions to it, in their reaction to uncertainty and ambiguity - some are motivated to reduce

ambiguity, while others tolerate and even enjoy entertaining it-and in their ways of thinking - whether they take a linear or nonlinear approach.

Sensitivities and sensibilities, personality and proclivities, are factors that can affect receptivity to Positive Turbulence. It is important to value differences for effective utilization of the

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knowledge coming in from the periphery while maintaining ongoing operations.” (p. 31)

While I am not an advocate of the command and control structure implied by

Gryskiewicz’ call for “imposing” Positive Turbulence, it is important to note

that leadership can set the tone for the interpretation of turbulence –

positively or negatively – and how the organization will respond. In fact,

Gryskiewicz’ distinction between “positive” and “negative” turbulence has

nothing to do with the inherently neutral essence of the turbulence itself, but

the attitude with which it is encountered by the leaders in the organization.

From this perspective, a positive attitude towards turbulence will yield

positive (efficient, profitable) responses.

It is important to note that, typical of most authors’ approaches to the

concept of turbulence, both Duncan’s and Gryskiewicz’ concepts refer only to

the first of Bergquist and Mura’s subsystems of turbulence – the “rapid flow.”

What of the other three subsystems (the whirlpool, the quiet pool, and the

boundaries between)? What is the relationship of these types of turbulence

to innovation?

Within whirlpools, “drag” is created by solid objects in the path of the flowing

stream (see figure, below). As the faster moving part of the stream begins to

curve to accommodate the drag (1), it circles back on itself (2), picking up

renewing energy from the flow and creating a whirlpool behind the stationary

object (3).

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Figure 5: Formation of a whirlpool

In this physical whirlpool of water and rocks, the outer edge (where there is

renewed energy) moves faster than the center (the location of the most

significant resistance). In a typical mountain river, there are numerous

obstacles, creating large and small whirlpools.

This is true in organizations. Whirlpools are the places in the stream where

innovations are likely needed.

Assume, for the sake of this analogy, that the “flow” is the pace of some

segment of the market. A relatively small obstacle to one organization’s

ability to “keep pace” with the market may be a particular feature that makes

one of their products less desirable to the adopters. An incremental

improvement in the product may likely remove that obstacle, reducing the

drag, and enabling the organization – at that particular point in the stream –

to maintain pace with the market. However, a larger obstacle downstream

may be a manufacturing process that is inhibiting responsive adaptations to

changes in the market; this will likely require a more significant, disruptive

form of innovation to rework the company’s approach to manufacturing, or

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possibly necessitating a switch to a completely different product line or other

source of revenue.

With respect to Bergquist and Mura’s “quiet pools,” these are areas where the

physical stream collects and processes organic debris5. This process serves

as a metaphor for the functions of rest, recreation, and reflection in an

organization. These “activities” are often interpreted as being “unproductive”

uses of time, in that they do not fit into the typical flow of work effort that

results in revenue-producing output. However, it is certainly my own

experience as an Executive Coach and observer of organizational process – as

well as the anecdotal reports of my peers – that these quiet and refreshing

times are necessary to the ideation segment of innovation. This is an area of

interest that warrants further research.

Finally, Bergquist and Mura describe the intersection points of rapid flows,

whirlpools, and quiet pools as a subsystem of turbulence. As described

earlier in this document, I view intersection points as inherently contributive

to innovation. They are where “business as usual” encounters something

novel, where new possibilities are conceived and tested. As Everett Rogers et

al described the effect of complex systems on the diffusion of innovations,

“Diffusion occurs most often in heterogeneous zones, i.e.,

transitional spaces where sufficient differentiation among network members comes to obtain. Such heterogeneous

network connections, which comprise the innovation-diffusion system, occur among innovators and other engaged members of target populations who, in Rogers’s original formulation, are

called ‘cosmopolites.’ Cosmopolites are locally networked system members with heterogeneous weak ties to outside systems.” (Rogers, Medina, Rivera, & Wiley, 2005)

5 Even though this almost sounds like the river has “intent,” I do not mean to imply that there is an active intelligence inherent in the process. The discussion of that possibility and

divine design is subject matter for a different venue.

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Indeed, the intersection of static, dynamic, and chaotic flows of

organizational energy and their impact on innovation is also an area of

immense interest that requires further study.

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Chapter 4: Leadership

What is leadership?

Perhaps, as Robert Greenleaf espouses (Greenleaf, 1998), “Part of my

excitement in living comes from the belief that leadership is so dependent on

spirit that the essence of it will never be capsulated or codified” (p. 112).

That has not kept a legion of pundits from trying.

Prefacing the work of the MIT Developmental Leadership Model

(http://sloanleadership.mit.edu/r-dlm.php), Deborah Ancona captures an

essence of the contemporary attitude towards defining leadership (Ancona,

2005):

“The Romans wondered whether force or inspiration was more

effective as a motivator. Our own culture glorifies the charismatic while preaching participation. Interest in this question has only intensified as we watch a new world order

unfold in the aftermath of September 11th, and as we are bombarded with images of corporate corruption and attempts at reform. We all hunger to know what leadership is, yet the

concept remains amorphous.

The history of leadership theory started with an emphasis on traits — the notion that it is the make-up of the leader that

makes all the difference. This approach dominated research up to the late 1940’s. Current research suggests that our admired leaders today are honest, inspiring, self-confident, and adaptive.

But traits do not always predict leadership effectiveness, and so researchers have shifted to look at the behavior or style of the

leader.” (p. 1)

There is an ongoing tension between the erudite camps of those who believe

that leadership can be defined by delineating the personality characteristics of

leaders, and those who think that leadership is more a matter of dynamic

roles, behaviors, and attitudes. In my analysis, one differentiator of these

schools of thought has emerged: the “character” contingent describes (and

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encourages emulation of) modern leaders, while the faction favoring eclectic

roles and behaviors connote postmodern leadership “principles.”

Modern view of leadership

In his 1935 tome, The Art of Leadership, Ordway Tead offered this definition:

“Leadership is the activity of influencing people to cooperate toward some

goal which they come to find desirable” (Tead, 1935). This attitude pervades

the modern view of leadership – that it is the leader’s responsibility to come

up with a brilliant idea and then convince everyone to execute on it. Indeed,

about the only distinction between premodern and modern leadership, in this

regard, is the source of authority to encumber followers to fulfill the plan; for

premodern leaders, it is the invocation of a higher power, for modern leaders

it is the invocation of the scientific method and the well-designed pro forma.

Heralding the leader

In the modern view, leadership is tautologically defined in terms of the

behavior and characteristics of identified leaders (Gabel, 2001). Much of the

literature supports this notion, in that it encourages learning about leadership

by reviewing the activities and opinions of CEOs and other corporate role

models who have been “successful,” as typically measured in financial terms.

Mike Freedman and Benjamin Tregoe define the CEO’s responsibilities: “

“In the 21st Century it is more critical than ever that CEOs

provide clear strategic leadership. In the ever-changing business landscape leaders must master both the art of strategy creation and formulation and the discipline of strategy

implementation and review… the Kepner-Tregoe five-phase model for strategy formulation and implementation [will] show

how your company can develop a strategic vision and action plan, communicate the vision, implement it, and monitor it to ensure ongoing success.” (Freedman & Tregoe, 2003)

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This role definition is the essence of modern leadership: define, communicate

(convince), implement, and measure. Each of these activities can be planned

and measured, befitting the modern organization. Classically-trained MBAs

thrive in this environment, given their inculcation of the tools to plan

objectives and measure results, as is profusely explained in Henry Mintzberg’s

critique of traditional MBA programs (Mintzberg, 2004).

The leadership literature overruns with examples of calling out the

characteristics of leaders that support this modern approach. David Dotlich

et al submit their addition in Head, Heart and Guts: How the world's best

companies develop complete leaders (Dotlich, Cairo, & Rhinesmith, 2006).

Gary Hoover (founder of Hoover’s Inc.) analyzes the characteristics from

several key leaders and adds his own observations:

“Great businesses succeed because of their leaders’ ability to

see things that others do not see. These leaders ask questions that others do not ask, then chart their own course, combining insights and strategies into the blueprint for a uniquely focused

enterprise. We’ve seen this leadership in entrepreneurs like Sam Walton, Michael Dell and others who do not follow a formula, yet find a way to succeed. They listen to their customers and,

most importantly, they follow their own visions of success.” (Hoover, 2001)

Jack Welch, former GE CEO, adds his contribution in Jack: Straight from the

gut (Welch & Byrne, 2002). It is not a coincidence that internal organs are

mentioned so frequently in this body of literature – a pervasive opinion is that

leadership originates within an individual, and that it requires singular

strength and courage to execute on one’s vision despite the many obstacles

to its fulfillment (including one’s employees). Remember that we are still

operating, in the modern frame, under McGregor’s Theory X, which states

that employees need coercion to comply with corporate objectives.

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Leadership does not always have to be boisterous and full of obvious

bravado, but must be executed with political aplomb (Badaracco, 2001).

Furthermore, as Theodore Kinni and Donna Kinni illuminate in No Substitute

for Victory: Lessons in strategy and leadership from General Douglas

MacArthur, leadership is often very public, and involves unerring commitment

to stated goals (Kinni & Kinni, 2005).

Warren Bennis goes to great lengths to document what he has observed as

primary characteristics of modern leadership from his hundreds of interviews

with named corporate and government leaders (Bennis, 1999). Similarly,

Peter Krass has set out to offer the wisdom of key leaders in his work (Krass,

1998). Common to these authors are the concepts of integrity, courage,

honesty, morality, intelligence, and other characteristics that are seen as

positive and upright throughout modern Western culture; these are

exemplified and magnified in the leader’s very public role. Despite the

corporate shenanigans at Enron and other similar occurrences (or perhaps

because of them), these characteristics are necessarily amplified in the

named leadership in order for them to maintain the trust and moral turpitude

to legitimately call for execution on their vision.

From that “larger than life” perspective, Lee Bolman and Terrence Deal

enumerate their list of characteristics by classifying them as traits of either

Wizard or Warrior (Bolman & Deal, 2006). Lou Gerstner, former IBM CEO,

focuses on passion and visibility as key characteristics of the successful leader

(Gerstner, 2002). Warren Buffet’s approach logically follows models for

financial growth (O'Loughlin, 2003).

Maintaining the hierarchy

Steven Sample, University of Southern California President, electrical

engineer, musician, professor, and inventor describes a modified set of

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characteristics that border on postmodern roles and approaches (thinking in

the gray areas between black and white aspects of issues, thinking “free,”

artful listening, and gathering input from the fringe); however, he urges

“maintaining the hierarchy” and executing these behaviors only with one’s

“lieutenants” (Sample, 2002). Similarly, Saj-nicole Joni encourages looking

outside to improve the diversity of the pool of possible ideas for a leader to

consider, but confines this activity to an “inner circle” of confidants (Joni,

2004).

Sample introduces another definitively modern theme: the reliance on the

hierarchy of the organization itself to provide an efficient vehicle for execution

of the leader’s vision. Paul Dolan, CEO of environmentally-conscientious

Fetzer Winery, encourages the relationship between the leader and the

systems of the organization and the surrounding community (Dolan & Elkjer,

2003), and Calhoun Wick et al describe the impact on the bottom line when

employees are properly trained and retained in the company (Wick, Pollock,

Jefferson, & Flanagan, 2006). Jim Collins urges leaders to clear the boards of

employees who are not compliant with the corporate vision, only allowing

those who want to sign up for the ride to be “on the bus” (Collins, 2001).

This emphasis on the people in the organization forays into postmodernism,

but there continues to be an element of viewing the employees as “assets”

(especially in Collins and in Wick), rather than colleagues in the business

(though that attitude is more prevalent in Dolan).

Towards an integrative theory of leadership

For a thorough review of various modern approaches to leadership, see

Martin Chemers’ An Integrative Theory of Leadership. Chemers’ own

synthesis of these various and often contradictory viewpoints concludes with

these postmodern-leaning recommendations (Chemers, 1997):

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“Effective leaders must accomplish three functions:

• Leaders must project an image of competence and

trustworthiness. They accomplish that projection by

matching their behavior to commonly held prototypes.

• Leaders must establish a relationship with followers that

guides, develops, and inspires them to make meaningful

contributions to group goals and the organizational mission.

Such relationships must match the needs and expectations

of followers, which leaders discern through nondefensive

judgments.

• Leaders must mobilize and deploy the collective resources of

self and team to the organizational mission by matching

operational strategy to the characteristics of the

environment.” (pp. 172-3)

Postmodern view of leadership

Stephen Covey, among others, has criticized the way in which leadership has

played out through modern times, and questions its validity as a paradigm for

the 21st century organization (Covey, 2004):

“Our basic management practices come from the Industrial Age. These include:

• The belief that you must control people;

• Our view of accounting (People are an expense;

machines are assets.);

• The carrot-and-stick motivational philosophy; and

• Centralized budgeting, which creates hierarchies and

bureaucracies to drive “getting the numbers” — a reactive process that produces “kiss-up” cultures bent on

“spending so we won’t lose it next year.”

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As people consent to be controlled like things, their passivity only fuels leaders’ urge to direct and manage. There’s a simple

connection between the controlling, Industrial Age, ‘thing’ paradigm that dominates today’s workplace and the inability of managers and organizations to inspire people’s best

contributions in the Knowledge Worker Age: People choose how much of themselves to give to their work, depending on how they’re treated. Their choices may range from rebelling or

quitting (if they’re treated as things), to creative excitement (if they’re treated as whole people).

[On the other hand…] Greatness involves transcending the negative cultural ‘software’ of ego, scarcity, comparison and competitiveness, and choosing to become the creative force in

your life.”

Recent theory regarding the nature of leadership has progressively bridged

toward postmodernism. Frances Hesselbein et al, in their 1996 The Leader of

the Future, intone the thoughts of Peter Drucker when they suggest that

there is no particular “leadership personality,” no set of characteristics –

innate or learned – that define superior leadership. They report that it is the

behavior, attitudes, and roles of the leaders wherein exemplary leadership

emerges. In support of this premise, they cite Covey’s Three Leader Roles:

pathfinding, aligning, and empowering (Hesselbein, Goldsmith, & Beckhard,

1996). In the 10-year update on The Leader of the Future, (Hesselbein &

Goldsmith, 2006), one of the co-authors, Marshall Goldsmith offers that:

“It is important to ‘reverse the pyramid’ and look at leadership

from the perspective of the wants and needs of the professional, as opposed to the perspective of the skills of the leader.

• Encourage their passion.

• Enhance their ability.

• Value their time.

• Build their network.

• Support their dreams.

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• Expand their contribution.

Leaders will need to go beyond looking at the work to be done and consider the human doing the work.”

This thinking represents a significant shift away from the modern concept of

nominal leader as all mighty (or the premodern notion that the leader

represents the Almighty) and acknowledges the worker as the source of

productivity and, by inference, innovation. Leadership becomes a role that is

assumed by any one at any time, depending on the needs of the moment.

Hesslebein again quotes Covey: “Leadership in the Knowledge Worker Age

will be characterized by those who find their own voice and who, regardless

of formal positions, inspire others to find their voice” (Hesselbein &

Goldsmith, 2006).

Throughout the literature over the past decade regarding leadership, key

trends have emerged in this shift towards postmodernism:

• An appreciation of employees as colleagues and collaborators.

• Empowerment through processes and rewards for successful management

of the innovation process.

• Flattening of the organizational hierarchy, especially with respect to

accountability and responsibility for activities within the employee’s

defined role.

• Servant leadership.

• Postmodern decision making; that is, the rapid response to changes in the

market driven by enabling leadership throughout the organization.

Appreciation of all members of the organization

Laurence Ackerman describes the benefit of valuing individuals in the

organization (Ackerman, 2000). In his model the “Laws of Identity” actually

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generate value for the organization, both as a source of customer revenue as

well as of internal energy that supports functionality and stability of the

company itself:

“The Laws of Identity can light the path to greater value creation.

• “The Law of Being. Any organization composed of one or more human beings is alive in its own right, exhibiting the distinct capacities of the individuals who make up that organization.

• The Law of Individuality. An organization’s human capacities invariably fuse into a discernible identity that makes that organization unique.

• The Law of Constancy. Identity is fixed, transcending time and place, while its manifestations are constantly changing.

• The Law of Will. Every organization is compelled by the need to create value in accordance with its identity.

• The Law of Possibility. Identity foreshadows potential.

• The Law of Relationship. Organizations are inherently relational, and those relationships are only as strong as the natural alignment between the identities of the participants.

• The Law of Comprehension. The individual capacities of the organization are only as valuable as the perceived value of the whole of that organization.

• The Law of the Cycle. Identity governs value, which produces wealth, which fuels identity.”

From a systems perspective, Patrick Lencioni criticizes the fallacy that simply

“matricizing” an organization will necessarily contribute to a positive climate

of innovation:

“Matrix organizations are forums for confusion and conflict. They have certainly not contributed to the breakdown of silos; they’ve merely added an element of schizophrenia and cognitive dissonance for employees who are unlucky enough to report into two different silos... The real problem with matrices is that

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they put employees in difficult situations by asking them to please two leaders who are not aligned with one another.

By achieving clarity about the number one priority in an organization, and by clearly identifying the defining and standard operating objectives that contribute to it, an employee will have far less reason to fear being pulled apart at the seams.” (Lencioni, 2006)

Lencioni posits that alignment with organizational goals will achieve more

along these lines than maintaining managerial enforcement of task-related

behaviors.

Empowerment

David Sirota et al fuel this discussion with the notion that employees are

more than functionaries in particular roles; they can be called on to support

the overall goals of the organization by providing skills and knowledge that

exceed the well-defined parameters of their job descriptions. The

empowerment to traverse those boundaries is what they term Participative

leadership.

“Participative leadership is an active style that stimulates

involvement. In an effective, participative organization, no one

is in doubt as to who is in charge. But that person expects employees to think, to exercise creative judgment, and not just do. That is the environment in which impediments can be

removed and in which employee enthusiasm can flourish.” (Sirota, Mischkind, & Meltzer, 2005)

Sirota goes on to define which goals (when successfully met) contribute to a

competent, participative organization. They call this The Three Factor

Theory of Human Motivation in the Workplace:

“There are three primary sets of goals of people at work: equity, achievement and camaraderie. This Three Factor Theory of Human Motivation in the Workplace maintains that:

1. These three sets of goals are what the overwhelming majority of workers want.

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2. No other goals are nearly as important for the vast majority of workers.

3. These goals haven’t changed over time and cut across cultures.

4. When your organization works to achieve these goals, the result will be high work-force morale and firm performance.”

Ken Blanchard, who’s gifted the corporate world with his One Minute

Manager titles since 1982, took an in-depth look at leadership (Blanchard,

2007), and came up with some decidedly postmodern observations:

“Empowerment Is the Key

How do the best-run companies in the world beat out the competition day in and day out? They treat their customers right. They do that by having a work force that is excited about their vision and motivated to serve customers at a higher level. So how do you create this motivated work force? The key is empowerment.

Empowerment means letting people bring their brains to work and allowing them to use their knowledge, experience and motivation to create a healthy triple bottom line. Leaders of the best-run companies know that empowering people creates positive results that are just not possible when all the authority moves up the hierarchy and managers shoulder all the responsibility for success. Researcher Edward Lawler found that when people are given more control and responsibility, their companies achieve a greater return on sales than companies that do not involve their people. Scholar Thomas Malone believes that empowerment is essential for companies that hope to succeed in the new knowledge-based economy.”

Blanchard continues by proposing a methodology for empowering employees,

which he calls “The Three Keys to Empowerment:”

“To guide the transition to a culture of empowerment, leaders must use three keys:

1. Sharing Information. One of the best ways to build a sense of trust and responsibility in people is by sharing information. Giving team members the information they need enables them to make good business decisions. High performing organizations continually look for ways

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to incorporate knowledge into new ways of doing business.

2. Declaring the Boundaries. In a hierarchical culture, boundaries are really like barbed-wire fences. They are designed to control people by keeping them in certain places and out of other places. In an empowered culture, boundaries are more like rubber bands that can expand to allow people to take on more responsibility as they grow and develop.

3. Replacing the Old Hierarchy with Self-Directed Individuals and Teams. As people learn to create autonomy by using newly shared information and boundaries, they must move away from dependence on the hierarchy. Self-directed individuals and Next Level teams — highly skilled, interactive groups with strong self-managing skills — replace the clarity and support of the hierarchy.”

In this model, authority clearly shifts from management to worker.

Accountability and responsibility for decisions are anticipated to be owned by

this well-informed, empowered staff. By doing so, the capacity to innovate

accelerates. Blanchard terms the approach that named leaders take to

achieve this level of empowerment, “Situational Leadership:”

“Situational Leadership: The Integrating Concept

If empowerment is the key to treating people the right way and motivating them to treat your customers right, having a strategy to shift the emphasis from leader as boss and evaluator to leader as partner and cheerleader is imperative. Is the direct report new and inexperienced about the task at hand? Then more guidance and direction are called for. Is the direct report experienced and skilled? That person requires less hands-on supervision. All of us are at different levels of development depending on the task we are working on at a particular time. To bring out the best in others, leadership must match the development level of the person being led. Giving people too much or too little direction has a negative impact on people’s development.

Situational leadership is based on the belief that people can and want to develop, and there is no best leadership style to

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encourage that development. You should tailor leadership style to the situation.”

Further, Blanchard suggests four styles of leadership: directing, coaching,

supporting and delegating, which correspond with what he proposes as the

four basic development levels of employees: enthusiastic beginner,

disillusioned learner, capable but cautious performer and self-reliant achiever.

“Enthusiastic beginners need a directing style, disillusioned learners need a

coaching style, capable but cautious performers need a supporting style and

self-reliant achievers need a delegating style.”

Blanchard goes on to suggest that Self Leadership is a function that can be

taught to all members of the organization. By doing so, aligning decisions

with corporate goals becomes a pervasive responsibility.

“Self Leadership: The Power behind Empowerment

Managers must learn to let go of command-and-control leadership styles, because soon they will have no choice. In the 1980s, a manager typically supervised five people — in other words, the span of control was one manager to five direct reports. Today, companies have more mean-and-lean organizational structures, where spans of control have increased considerably. Now it is common to find one manager for 25 to 75 direct reports. Add to that the emergence of virtual organizations — where managers are being asked to supervise people they seldom, if ever, meet face to face — and we have an entirely different work landscape emerging.

The truth is that most bosses today can no longer play the traditional role of telling people what, when and how to do everything. More than ever before, companies today are relying on empowered individuals to get the job done.”

Blanchard concludes by declaring that developing Self Leaders positively

impacts the bottom line, proposing that the three skills of the Self Leader are:

1) Challenge Assumed Constraints; 2) Celebrate Points of Power (position

power, personal power, task power, knowledge power, and relationship

power); and 3) Collaborate for Success. Relating Blanchard’s Self Leader

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skills to the concepts discussed throughout this monograph: Challenging

Constraints equates to creative thinking “outside the box;” Celebrating Power

is an acknowledgement of empowerment, responsibility, and accountability;

and Collaboration leverages the diversity of thought and skills in any

organization.

Blanchard’s notions are underlined by Stephen Covey (Greenleaf, 2002) when

he says,

"In order to get the kind of trust in a culture that enables an empowerment approach to thrive, we must not only have individuals who are trustworthy and whose vision is shared with the organization, but we must have a trustworthy organization - one that fosters and supports empowerment. Again, unless systems and structures that foster empowerment are institutionalized, there will be no reinforcement." (p. 3)

In that same vein of empowering employees to greatness, John Sosik

suggests an approach he calls “Transformational Leadership” (Sosik, 2006).

He states that, “Transformational leaders act in ways that turn followers into

leaders. By empowering their followers, they build excitement around an

appealing vision that creates performance excellence in challenging economic

and political times.” Sosik proposes that there are four behaviors inherent in

Transformational Leadership that he calls, “The Four I’s:”

“Idealized Influence: Leaders display pro-social and positive

behaviors to model organizational values such as high levels of ethical and performance standards.

Inspirational Motivation: Leaders use this behavior to energize

their followers to do more than is expected.

Intellectual Stimulation: Leaders use this quality to get

followers and constituents to re-examine assumptions, seek

different perspectives, look at problems in new ways and encourage nontraditional thinking.

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Individual Consideration: Leaders use this behavior with their

followers to recognize their unique potential to develop into leaders themselves.”

These leader behaviors also map well to the concepts already discussed, in

that they serve to transfer knowledge, skills, and accountability from

traditional (modern) management to the employees, who have the

responsibility for innovating at the point of contact with the customers. Of

course, the shadow side of empowerment is the element of risk – the further

down the management chain the responsibility is “pushed,” the less

centralized and less controllable the inherent risk in innovation becomes.

One of the functions of named leaders, then, is to manage the impact of this

risk on the valuation of the company. Constant communication on the status

and goals of the organization will help maintain the alignment of worker

efforts –including innovation – with those objectives. However, another

important leaderly function is to help insulate the employees from chronic

anxiety over risk, assuring a proscribed level of tolerance for failure. As

Frances Hesselbein et al quoted IBM’s Thomas Watson, Jr. (Hesselbein,

Goldsmith, & Beckhard, 1996), the postmodern leader’s attitude when

recognizing opportunity for growth might be, “We don’t have enough people

out there making mistakes.”

Flattening the hierarchy

No discussion of employee empowerment and high functioning environments

would be complete without exploring from the perspective of Emotional

Intelligence. Daniel Goleman et al speculate that:

“The best, most effective leaders act according to one or more of six distinct approaches to leadership. Four of the styles — visionary, coaching, affiliative and democratic — create the kind of resonance that boosts performance. The other two — pacesetting and commanding — should be applied with caution.” (Goleman, Boyatzis, & McKee, 2002)

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These approaches - especially affiliative and democratic – are compliant with

the developing notion of innovation leadership, generating the kind of

environment in which ideation and invention can occur. Other leader and

authors echo this empowerment and creativity theme. Randall Tobias and

Todd Tobias opine regarding leadership:

“Leadership is about far more than producing results through one’s own initiative — it’s about producing results through others.

Leadership is as much about listening, about building relationships, about providing encouragement when it’s needed, as it is about communicating one’s own ideas.

Leaders almost always think out of the box. They listen, observe, share ideas and shamelessly borrow from the experiences of others.” (Tobias & Tobias, 2003)

Roger Martin calls this infusion of empowerment and the associated

accountability to all levels in the organization, “The Responsibility Virus.” He

claims that it is the responsibility of named leaders to spread the virus

through inspirational infection:

“Two of the most cherished leaders of the 20th century, Winston Churchill and John F. Kennedy, are revered for asking their followers to take responsibility even more than they are revered for taking it on themselves. Churchill, promising blood, sweat and tears, exhorted his country to hold firm and not give up during the darkest days of the Battle of Britain. ‘Let us brace ourselves to our duties and so bear ourselves that if the British Empire and its Commonwealth last for 1,000 years, men will still say: this was their finest hour.’

Kennedy’s most memorable line was not a call for the government to take more responsibility. Rather, it was the admonition, ‘Ask not what your country can do for you; ask what you can do for your country.’ In both cases, the call for greater responsibility on the part of the followers created a closer bond between the leader and his constituency, as well as a collective heightening of capabilities, resourcefulness and engagement in the task at hand. Churchill and Kennedy are both guaranteed their place in the pantheon of great leaders.”

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Servant leadership

As early as 1970, at least one voice began to question the role of the modern

leader. Robert Greenleaf led off his bellwether volume, Servant Leadership

(Greenleaf, 2002), by asking,

“Servant and leader – can these two roles be fused in one real person, in all levels of status or calling? If so, can that person

live and be productive in the real world of the present? My sense of the present leads me to say yes to both questions.” (p. 21 in the 25th Anniversary Edition)

Greenleaf continues by referencing the Hermann Hesse’s novel, Journey to

the East, in which a group on a mystical journey is confused by the duality of

a main character, Leo, who at first is presented as servant and then again

later as leader. Leo suffers no schizophrenia, in that he is, at his core, a

servant, and the ultimate service he can perform with his tribe is as its

leader. But the modern travelers are mystified how someone in such an

“elevated” role can be so inherently servile.

In a 1998 sequel to Servant Leadership, Greenleaf intones the greater good

that would be brought about by universal iteration of servant leadership

(Greenleaf, 1998):

"I believe that caring for persons, the more able and the less able serving each other, is what makes a good society. Most

caring was once person to person. Now much of it is mediated through institutions - often large, powerful, impersonal; not always competent; sometimes corrupt. If a better society is to

be built., one more just and more caring and providing opportunity for people to grow, the most effective and economical way while supportive of the social order, is to raise

the performance as servant of as many institutions as possible by new voluntary regenerative forces initiated within them by committed individuals: servants." (p.17)

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Greenleaf’s admonition encourages a leap into postmodernism for

organizations. The idea that a major (if not sole) function of business

institutions is to serve as a conduit for social development is a progressive

concept. While we all acknowledge that, to one degree or another, we

engage in social relationships at work, and that those interactions both reflect

and contribute to the formation of our personalities and our lives in general,

we often attempt to segregate our “work lives” from out “home lives,” as if

we are different people in those different settings. We even try to reach a

“balance” between “work” and “life,” as if each were an entity that could be

equally weighted over some ideal fulcrum. As Paul Baffes suggests (Baffes,

2005), achieving a state of balance is an illusion – it is the activity of moving

agilely between different environments that provides a sense of fulfillment in

all of them, while maintaining a secure, core self. The frustration in not

sustaining a centered self results in what Robert Kegan calls, “multiphrenia”,

an anxiety producing condition of trying to respond distinctively to the variety

of cultural demands of “who we are to be” across the constantly shifting

circumstances of everyday life in the 21st century (Kegan, 1994).

In a foreword to the 25th Anniversary Edition of Greenleaf’s Servant

Leadership (Greenleaf, 2002), Stephen Covey offers a postmodern

perspective on how servant leadership has reached a level of value in today’s

corporate environment:

"I love this statement made by Stan Davis, 'When the infrastructure shifts, everything rumbles.' Well, everything is

rumbling because the old rules of traditional, hierarchical, high-external-control, top-down management are being dismantled: they simply aren't working any longer. They are being replaced

by a new form of 'control' that the chaos theory proponents call the 'strange attractor' - a sense of vision that people are drawn

to, and united in, that enables them to be driven by motivation inside them toward achieving a common purpose. This has

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changed the role of manager from one who drives results and motivation from the outside in, to one who is a servant-leader -

one who seeks to draw out, inspire, and develop the best and highest within people from the inside out. The leader does this by engaging the entire team or organization in a process that

creates a shared vision, which inspires each person to stretch and reach deeper within himself or herself, and to use everyone's unique talents in whatever way is necessary to

independently achieve that shared vision." (p. 3)

Covey’s 8th Habit (of highly effective people) is “Find your voice and inspire

others to find theirs” (Covey, 2004). This is a clarion call for leaders to

abandon the notion of totalitarian authority and be servants first. It requires

not only awareness of self but empathy for others, to help them discover

their own special abilities – their voices. This is no easy task. Charles Manz

actually dedicates his guidebook, The Leadership Wisdom of Jesus, “To all

those brave persons who have taken up the quest for a wiser and more

compassionate form of leadership that seeks to unleash the inner leadership

and value of each person” (Manz, 1999). Manz observes from this New

Testament-based perspective: "Great trees grow from tiny seeds. Wise

leadership involves planting good seeds in good places at the right times, and

then letting great things grow" (p. 149).

Postmodern Decision Making

In a postmodern organization, the process of making decisions is recognized

to be a multi-layered function as opposed to the modern precept that most

decisions are made by management and implemented by the workers. This

difference between modern and postmodern decision making is enumerated

by Michael Roberto as the distinctions between myths and realities, in the

following table from Why Great Leaders Don’t Take Yes for an Answer

(Roberto, 2005):

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Myth Reality

The chief executive decides. Strategic decision making involves simultaneous activity at multiple levels of the organization.

Decisions are made in the room. Much “real” work occurs offline, in one-on-one conversations or small subgroups.

Decisions are largely intellectual exercises.

Strategic decisions are complex social, emotional and political processes.

Managers analyze systematically and

then decide.

Strategic decisions unfold in a

nonlinear fashion; solutions often arise before managers define problems or analyze alternatives.

Managers decide and then act. Strategic decisions often evolve over time through iterative choices and actions.

Table 1: Myths and realities of strategic decision making, from Roberto (2005)

Pervasive leadership

Perhaps one of the most direct and progressive authors on this topic of

postmodern leadership is Joseph Raelin. While he acknowledges that he did

not invent the term, leaderful, he has taken the concept of being leaderful to

reflect a pervasive paradigm; people can be leaderful throughout the entire

organization, at every level. Opening his book on the subject (Raelin, 2003),

he educates us on the basic tenets of the “Leaderful Practice:”

“I would like to introduce you to an alternative paradigm of leadership: ‘leaderful practice.’ It directly challenges the conventional view of leadership as ‘being out in front.’ In the twenty-first-century organization, we need to establish communities where everyone shares the experience of serving as a leader, not serially, but concurrently and collectively.” (p. 5)

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Raelin proposes that leadership practices fall on a continuum from

“conventional” to “leaderful” – or what we might call modern to postmodern

– across four characteristics. The leaderful end of the spectrum defines

Raelin’s “Four C’s: Concurrent, Collective, Collaborative, and Compassionate.”

Conventional ⇔

Leaderful

Serial ⇔

Concurrent

Individual ⇔

Collective

Controlling ⇔

Collaborative

Dispassionate ⇔

Compassionate

Table 2: The Continua of Leadership (Raelin, 2003)

Serial ⇔ Concurrent: In the serial environment, the role of leader passes

from one named individual to another, and there is only one identified leader

in the group at any time. In a concurrent leadership setting, there may be

several individuals who are capable of leading the group’s efforts at any given

time, and the role is shared among all of them, depending on the needs of

the group at the moment.

Individual ⇔ Collective: Further, rather than having only one individual serve

as leader at a time, the leaderful organization will have two or more leaders

serving simultaneously, usually reaching decisions by consensus.

Controlling ⇔ Collaborative: In a conventional setting, one of the functions

of the leader is to control the work effort (in anticipation of dictating the

outcome); in a leaderful group, the members contribute their best efforts in

alignment with group goals to achieve a successful, collaborative outcome.

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Dispassionate ⇔ Compassionate: Finally, in a conventional work place, the

workers are treated as equipment, whose job it is to take certain input and

generate defined output; they are treated without compassion for their needs

or their other potential contributions to the organization. In a leaderful

environment, all members are considered to be stakeholders, adding their full

potential to the realization of the organization’s goals.

It is important to note that, as Raelin indicates, any given group at any given

time will fall on the continuum somewhere between conventional and

leaderful – or modern to postmodern. It is evident that innovation – which

requires agility and best-efforts in appreciatively adapting to turbulence –

would benefit from leadership practices that more closely adhere to the

principles of leaderful organizations. Perhaps this is exemplified by the

success of Nordstrom’s in its reputation for customer service. This is the

elegant instruction given to each new employee (Tushman & O'Reilly, 2002):

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“WELCOME TO NORDSTROM.

We’re glad to have you with our company.

Our number one goal is to provide outstanding customer service.

Set both your personal and professional goals high.

We have great confidence in your ability to achieve them.

Norstrom Rules:

Rule #1: Use your good judgment in all situations.

There will be no additional rules.

Please feel free to ask your department manager,

store manager, or division general manager

any question at any time.” (p. 131)

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Chapter 5: Innovation Leadership

The intersection of innovation and leadership

To date, most of the literature has used the intersection of the terms

innovation and leadership to modify one with the other; viz., Innovation

Leadership equals either “a new (innovative) approach to leadership” via the

author’s particular methodology (Pomerantz, 2006), or “an approach to lead

innovation efforts in your organization” (New & Improved, 2006). These are,

of course, legitimate uses of the combination of the two terms. However, I

propose a more synergistic integration of the concepts; that is, Innovation

Leadership is a pervasive style of working to enhance the organization’s

climate of appreciative adaptation to turbulence.

The power of this concept occurs in its intersection. As previously discussed

in this monograph, I believe that intersections are the locations of the

greatest activity, and the greatest interest to organizational psychology. As

we have seen in discussing the concept of turbulence and its physical

analogy, it is the intersection of whitewater and objects that create

whirlpools, and the intersection of the main flow in a river that carries and

deposits flotsam to the quiet pools, where nutrients are then formed and

returned to the ecosystem (yes, through the intersection and back into the

main stream). It is at the intersections of roads, rails, and rivers that

commerce flourishes, and the interaction of individuals leads to the

interaction of ideas, contributing to innovation.

The complete intersection of Innovation and Leadership results in much more

than the two separate concepts simply complementing each other.

Implementing the progressive ideas of postmodern leadership actively

enhances innovation by enabling workers, who live at the intersection of

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customers and production, to respond efficiently to changes in customer

requirements. Implementing progressive innovation practices (e.g. think

broadly, act personally; create substantial change; ignite technology

innovation; defy limits; and force an outside look (IBM, 2006)) supports and

relies on the practice of postmodern leadership principles.

Figure 6: Innovation and Leadership are mutually supportive

Following this definition of Innovation Leadership (a pervasive style of

working to enhance the organization’s climate of appreciative adaptation to

turbulence, above), everyone in the organization has the opportunity and the

responsibility (leadership) to appreciatively adapt to turbulence (innovation).

Postmodernism recognizes that line workers are constantly making decisions

that impact the functioning of the organization. In that innovation requires

decisions at the transition points from ideation to invention, invention to

instantiation, and instantiation to adoption, this recognition is crucial to

empowering innovation at the point of its generation. As Ronald Heifitz and

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Donald Laurie observe (Heifetz & Laurie, 1998), “Solutions to adaptive

challenges reside not in the executive suite but in the collective intelligence of

employees at all levels” (p. 173). Decisions made by innovators and

adopters, if the resulting innovations are to be aligned with corporate goals

and contribute to the bottom line, must be recognized and integrated into the

innovation management process. As Bettina von Stamm observes (von

Stamm, 2003b):

"Leadership can take place at any level within the organization, and whereas 'management' is about directing people, about efficiency, structuring and organizing, leadership is about

motivating people and about inspiring them to go the extra mile - something that is often required in innovative projects..." (p. 381)

In all of the recent, separate writings that focus on the concepts of innovation

and leadership, is there a direct path of reasoning that arrives at Innovation

Leadership? Starting with the interest in generating more innovative

responses to market trends, we ask, “What is the measure of a successful

innovation?” This is, in part, answered by Rogers, Gladwell, and others’

discussions of diffusion – if an innovation is diffused across the population to

a significant extent, it can be considered a success.

The next question is, “How can we increase the rate and extent of diffusion,

to make it a commercial and economic success?” Answering this requires the

breakdown of innovation into the Innovation Continuum and the

management of the various aspects of innovation: ideation, invention,

instantiation, and adoption. “Management” then implies “leadership,” and the

discussion of the forms of leadership that support appreciative adaptation to

turbulence ensues.

Lastly, “How do we measure successful Innovation Leadership?” The

qualification of what constitutes effective Innovation Leadership is assessed

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by examining the Innovation Climate – when the Innovation Climate is

qualitatively “good,” Innovation Leadership is at work.

Application of the theories

These theoretical constructs are interesting from an academic perspective;

however, how do these theories and anecdotes translate into corporate

practice? As an employee of the IBM Business Consulting Services

contingent, I became interested in this question on behalf of our customers.

How can we use all this speculation to actually enhance the innovative

climate of organizations? Specifically, how can Innovation Leadership be

inculcated in a client’s company to promote their ability to be more

innovative?

The IBM BCS general approach to these types of customer-driven questions is

to define an Engagement Model that will contain the necessary consulting

elements to help the customer arrive at particular outcome; in this case, an

improved Innovation Climate via enhanced Innovation Leadership.

Engagement Model

At IBM, consultation offerings are defined in an Engagement Model. This

model covers every aspect of the relationship with the client around the

defined concept of the consultation, from needs assessment through work

breakdown structures of consultation activities, through evaluation of delivery

excellence. The effort that has led to this monograph focused on the “needs

assessment” component of the engagement, and the initial instrument for

this assessment will be detailed in the following sections. The additional

processes that I have conjectured to support the subsequent phase of the

consultation would include one or more consulting activities: specific training

and education workshops; executive coaching; information technology to

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support social networking and collaborative innovation; human resources

transformation; and other interventions, based on the outcomes of the

analysis.

Survey

The proposed Innovation Leadership survey is a device to begin the iterative

assessment of innovation climate, to identify growth areas that would be

addressed in the consultation. It has also served as the constructed

repository for the collection of concepts from my research, forming a

foundation of research-based statements that would eventually contribute to

the concept of Innovation Leadership.

The survey was designed to be administered by the Capabilities Assessment

Tool (CAT), which is currently under development by Matt Callery at the IBM

Thomas Watson Research Center in Hawthorne, New York. The CAT has

been used internally for IBM projects, and experimentally with customers, to

help assess a variety of issues. It has to-date been deployed primarily as a

“readiness assessment” tool, to determine how prepared an organization is

for the implementation of a particular technology.

A CAT survey is administered via web interface; that is, a respondent is

presented with a questionnaire through a typical web browser (like

Microsoft’s Internet Explorer) and submits answers to individual questions by

clicking on multiple choice responses, or typing in responses to open-ended

questions. The responses are stored and then analyzed and reported to the

survey author through a separate, web-based interface. A pictorial

representation of the CAT workflow follows:

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Figure 7: CAT Workflow Diagram © 2006 IBM Corporation

To prepare the Innovation Leadership CAT survey, I developed a list of

survey items (profiled in a following section) that were organized by category.

As defined later, the survey items were segregated into characteristics within

two overall categories: Individual and Organizational. The screen to input the

question and define the response type is illustrated here6:

6 Note that the original term used to describe one category was “Culture;” this has been changed to “Climate” in this monograph in keeping with the discussion on Climate vs.

Culture, above.

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Figure 8: CAT Questionnaire Builder © 2007 IBM Corporation

Each of the survey items was entered, named, and assigned a response type.

In the illustrated example, the statement “This organization helps me meet

my personal goals” was entered, named “Personal Goals” (to help track

responses reported later), and assigned a “Multiple Choice – Single Select”

type of response.

In keeping with the acknowledged value of an appreciative approach, each of

the statements is framed in a manner that leads the respondent to

contemplate the desired objective, according to the theorist being

represented7. The respondent is then asked to rank each statement on a

7 The survey is meant to be a dynamic tool; it was designed to be delivered via web browser

so that items can be added, deleted, or modified as new information is considered. The

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Leickert-like scale, from “Strongly Disagree” (having a value of zero) to

“Strongly Agree” (having a value of four).

The resulting score is mapped, according to its category, to a graph known

alternatively as a “radar” or “spider web” chart. This graphic representation

provides an interpretation of how certain characteristics relate to each other,

within an organization.

Figure 9: CAT Radar Graph © 2007 IBM Corporation

This survey approach (viz., using all appreciative statements) obviates the

use of this particular instrument to validly compare the innovative climate of

original survey – its current iteration – is based on works from 17 authors, which is only a subset of those referenced in this monograph. However, these items are entirely

representative of the intent and direction of this tool.

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one organization versus another, or even within the same organization across

time, as it is not compliant with psychometric principles that would be needed

to use the device in that manner. There are individuals and organizations

that do have such instruments and processes (CCL, 2005; CPSG, 2002;

Hosseini, Azar, & Rostamy, 2003; Länsisalmi & Kivimäki, 1999). However,

this appreciative approach was conceived purposefully as way to begin a

conversation with the members of the organization regarding the principles of

a positive innovation climate, simultaneously serving assessment and

educational purposes.

The following sections detail the survey categories, sub-categories (i.e.,

characteristics), and statements. A Glossary of Terms used in the survey

follows the list of specific statements.

Categories

All of the statements fall into one of two major categories: they represent

either Individual or Organizational characteristics. The following paragraphs

explain the distinction between these overarching categories.

Individual

Individual characteristics are those that are recognized most readily in

individuals (as opposed to the organization as a whole). Individual

characteristics are: Integrity, Dedication, Respect, Virtue, and Support.

Organizational

Organizational characteristics are those that are most readily recognized in

the organization as a whole, rather than individuals. While some

characteristics may be evident in individuals, this group of survey items

should be evaluated across the entire organization and not simply in one

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individual. The organizational characteristics examined in this survey are:

Climate, Learning, Systems Approach, and Empowerment.

Specific characteristics and survey statements

These are the specific characteristics for each of the Individual and

Organizational categories. Each of the characteristics is further comprised of

statements that I have gleaned from the literature that are appreciative goals

for an organization that aspires to cultivate a climate of innovation across the

organization. Each survey statement is followed by the reference for the

source on which it is based. Further explanations of the terms and the intent

of the statement are detailed in footnotes and the Glossary of Terms.

Individual

Integrity

• Management's actions match their statements. (Bennis, 1999)

• In this organization, there is no 'blame' for failed attempts to improve. (Senge, 1990)

• Leaders in this organization base their decisions on moral and intellectual

honesty. (Bennis, 1999)

• Leaders in this organization are consistent in their foundational words and

actions across time. (Bennis, 1999)

• Leaders are self-referential. (Wheatley, 1999)

Dedication

• Leaders in this organization are dedicated to the success of the

organization. (Bennis, 1999)

• Leaders in this organization step up to take responsibility for the direction

of the organization. (Heifetz & Laurie, 1998)

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Respect

• In this organization, leaders respect the work of all individuals. (Bennis,

1999)

• In this organization, workers respect the leaders. (Bennis, 1999)

• Leaders in this organization inspire trust. (Bennis, 1999)

• Leaders in this organization are like orchestra conductors8. (Bergquist,

2003)

Virtue

• Leaders are viewed as heroes. (Bennis, 1999)

• Leaders are noble of mind and heart. (Bennis, 1999)

• Leaders are open to trying new ideas. (Bennis, 1999)

• Leaders are creative. (Bennis, 1999)

• Leaders in this organization inspire loyalty. (Bennis, 1999)

• Leaders are the ultimate servants. (Bergquist, 2003)

• Leadership is a sacred trust. (Bergquist, 2003)

Support

• Leaders promote self-supporting teams within the organization. (Wheatley, 1999)

• Leaders in this organization regulate the balance between stasis and chaos. (Heifetz & Laurie, 1998)

• Leaders protect the voices of leadership from below. (Heifetz & Laurie,

1998)

8 Orchestra conductors rely heavily on the individual talents and performances of the members of the “team.” The conductor is the acknowledged group leader, responsible for providing the vision for the music, communicating via physical expressions of timing and

mood.

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Organizational

Climate

• This organization helps me meet my personal goals. (Knowles, 1980)

• This organization helps me meet my professional goals. (Knowles, 1980)

• This organization considers everyone's opinions and needs when making

decisions. (Cloke & Goldsmith, 2003)

• Development activities are closely linked to identified business needs.

(Sharma, 2006)

• This organization sets the environment for open collaboration. (Sharma,

2006)

• This organization recognizes when "slow" is appropriate. (Senge, 1990)

• This organization invests in initiatives that may take months or years to realize their full benefit. (Senge, 1990)

• Boundaries among various departments in this organization are flexible and dynamic. (Senge, 1990)

• Amid turbulence, this organization seeks to find balance between resistance and chaos. (Senge, 1990)

• This organization tolerates and positively uses dissent. (Bennis, 1999)

• Change in this organization is promoted across all 3 levels of structure,

process, and attitude. (Bergquist, 2003)

• This organization leans into the future. (Bergquist, 2003)

• This organization leverages the best skills employees have to offer. (Bergquist, 2003)

• This organization differentiates between "culture" and "climate" when referring to the organization9. (Bergquist, 2003)

• This organization makes changes that are meaningful and not superficial for the sake of change. (Weisbord, 2004)

9 The distinction between culture and climate was discussed earlier in this monograph (Chapter 2). If an organization persists in attempting to implement changes at the culture level, it will be frustrated and will not be effective in its transformation efforts, losing the

alignment that would contribute to effective innovation.

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• This organization identifies and works to embrace adaptive challenges.

(Heifetz & Laurie, 1998)

• This organization maintains disciplined attention to issues. (Heifetz &

Laurie, 1998)

• This organization guides cultural evolution rather than attempting cultural change. (Schein, 1999)

• This organization is able to articulate the business value of innovation. (Spitzer, 2007)

• This organization forms and supports user communities as psrt of the innovative process. (von Hippel, 2006)

Learning

• There are opportunities to critically review the results from prior innovative efforts. (Mavrinac, 2005)

• This organization promotes perpetual learning for individuals. (Schein, 1992)

• This organization promotes perpetual learning for teams. (Schein, 1992)

• This organization actively seeks out and leverages industry trends when

defining new products and services. (Senge, 1990)

• This organization is willing to move out of its comfort zone. (Senge, 1990)

• This organization views business processes from a 'global' perspective but enables 'local' action. (Senge, 1990)

• This organization leverages existing processes that work well to develop new processes. (Senge, 1990)

• This organization provides time and resources to develop new employee skills. (Bergquist, 2003)

• This organization tends to learn valuable lessons from its mistakes. (Senge, 1990)

• This organization routinely engages in double-loop learning. (Argyris & Schön, 1996)

• This organization works to overcome the learning paradox. (Argyris & Schön, 1996)

• This organization identifies and polls its lead users to help discern future trends. (von Hippel, 2006)

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Systems Approach10

• This organization promotes examining issues from a systems perspective.

(Senge, 1990)

• This organization takes a long-term approach to problem resolution.

(Senge, 1990)

• This organization avoids commoditizing its products and services by

measuring non-standard performance indicators. (Spitzer, 2007)

• This organization establishes "what success looks like" and measures to

determine achievement to that goal. (Spitzer, 2007)

• This organization looks to its customer community to discover how

products and services are being modified to suit their needs. (von Hippel, 2006)

• This organization is aware of its customers' decisions to innovate (create

themselves) or buy decisions. (von Hippel, 2006)

Empowerment

• I have the opportunity to tell my story to the organization. (Crawford-

Cook, 2006)

• This organization provides me with appreciative feedback on my

performance. (Bergquist, 2003)

• This organization appreciates the human spirit in employees. (Bergquist,

2003)

• Employees develop the plans they implement. (Wheatley, 1999)

• This organization supports open, collegial, fluid networks for the free flow of information. (Wheatley, 1999)

• This organization assumes Theory Y as opposed to Theory X. (Weisbord, 2004)

• This organization promotes holding responsibility for the work by the people working the task. (Heifetz & Laurie, 1998)

10 Taking a systems approach includes a perspective that includes customer as well as internal viewpoints, and the capability to establish and measure appropriate performance

indicators across the organization.

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• Employees have the authority to implement innovative responses to

deficits. (Spitzer, 2007)

• Employees have continuing personal involvement in creating their own

performance measures and are empowered to take action on their measurements. (Spitzer, 2007)

• This organization makes an effort to democratize innovation. (von Hippel,

2006)

Glossary of Terms used in the survey statements

Adaptive Challenges

• Heifetz & Laurie (1998)

o Changes in societies, markets, customers, competition, and

technology around the globe [that force] organizations to clarify

their values, develop new strategies, and learn new ways of

operating.

Democratizing innovation

• Von Hippel (2006) chap. 9

o “How can or should manufacturers adapt to users’

encroachment on element of their traditional activities [i.e.,

designing and manufacturing consumer products]? There are

three general possibilities: (1) Produce user-developed

innovations for general commercial sale and/or offer custom

manufacturing to specific users. (2) Sell kits of product-design

tools and/or ‘product platforms’ to ease users’ innovation-

related tasks. (3) Sell products or services that are

complementary to user-developed innovations. Firms in fields

where users are already very active in product design are

experimenting with all these possibilities.” (p. 15)

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Double-loop Learning

• Argyris & Schön (1996), p. 21

o Learning that results in a change in the values of theory-in-use,

as well as in its strategies and assumptions. The double loop

refers to the two feedback loops that connect the observed

effects of action with the strategies and values served by

strategies. Strategies and values may change concurrently

with, or as a consequence of, change in values. Double-loop

learning may be carried out by individuals, when their inquiry

leads to change in the values of their theories-in-use or by

organizations, when individuals inquire on behalf of and

organization in such a way as to lead to a change in the values

of organizational theory-in-use.

Effective use of peripheral energy and information

• Gryskiewicz (1999) chap. 5

o “The periphery is a prime source of turbulence. Whether one

brings it in or not, that pool of potentially catalyzing information

and ideas flows past an organization. It is up to the astuteness

of a group’s leasers as to how well or poorly the turbulence will

be used.” (p. 81)

o Sources of peripheral energy and information:

� Recruiting new talent

� Bringing in outside experts

� Seizing opportunities for cross-fertilization

� Hiring a diverse workforce

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� Merging companies

� Forging alliances

� Sparking energy among employees

� Holding internal trade shows

� Promoting informal information exchanges

� Creating informal meeting spaces

� Encouraging free-ranging ideas

� Being open to off-center perspectives

Information Communities

• Von Hippel (2006) p. 165

o “I define information communities as communities or networks

of individuals and/or organizations that rendezvous around an

information commons, a collection of information that is open to

all on equal terms.”

o “Many of the considerations I have discussed with respect to

user innovation communities apply to information communities

as well – a much more general category of which user

innovation communities are a subset.”

Innovate or Buy Decisions

• Von Hippel (2006) chap. 4

o Consumers, especially Lead Users, will sometimes decide to

build their own solutions when the products or services offered

on the market are not adequate to meet their needs. There is a

continuum from outright buying to building, including the

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licensing or purchase of products with the right to modify them

to ultimately meet the consumers’ needs.

Innovation Communities

• Von Hippel (2006) chap. 7

o “Innovation by users tends to be widely distributed rather than

concentrated among just a very few very innovative users. As a

result, it is important for user-innovators to find ways to

combine and leverage their efforts. Users achieve this by

engaging in many forms of cooperation. Direct, informal user-

to-user cooperation (assisting others to innovate, answering

questions, and so on) is common. Organized cooperation is

also common, with users joining together in networks and

communities that provide useful structures and tools for their

interactions and for the distribution of innovations. Innovation

communities [italics added] can increase the speed and

effectiveness with which users and also manufacturers can

develop and test and diffuse their innovations. They also can

greatly increase the ease with which innovators can build larger

systems from interlinkable modules created by community

participants.” (p. 11)

Lead Users

• Von Hippel (2006), chap. 3

o Lead users are potential consumers who are expert in their

domains, to the point that they often customize commercial

products or construct their own. Von Hippel often refers to the

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mountain bike enthusiast who more often than not performs

several modifications to purchased bikes.

Leadership

• Taffinder (2006)

o The easy answer: leadership is getting people to do things they

have never thought of doing, do not believe are possible or that

they do not want to do.

o The leadership in organizations answer: leadership is the action

of committing employees to contribute their best to the purpose

of the organization.

o The complex (and more accurate) answer: you only know

leadership by its consequences from the fact that individuals or

a group of people start to behave in a particular way as a result

of the actions of someone else.

Learning Paradox

• Argyris & Schön (1996) pp. 281-282

o The essence of the learning paradox is that the actions we take

to promote productive organizational learning may actually

inhibit deeper learning. The steps that lead to this learning

paradox can be summarized as follows:

1. Problems are identified in discussable domains, for example,

organizational structures or information systems. The

domains that are not discussable are bypassed, and the

bypass is covered up. Variables in the undiscussable domain

(associated with generic defensive patterns) may be

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recognized privately and discussed informally, but they are

considered as externalities.

2. Solutions are generated to deal with discussable features of

the problems. Important features in the undiscussable

domain are excluded. This act of exclusion is covered up

and often explained away by reasons ("human nature," for

example) that fall outside the responsibility of the

participants, or go beyond what they can influence.

3. During the early stages of intervention, the solutions do

appear to correct some organizational errors. Most of the

solutions are single-loop in nature, and most of the

participants have (or can readily be taught) the skills

necessary for their implementation. But as error correction

falls short of expected results, the importance of the

undiscussable issues becomes increasingly apparent.

4. The participants begin to experience a double bind. If they

face up to the issues they have treated as undiscussable,

they will also have to make public how they have bypassed

them or covered them up. If they do not make these issues

public, they will know that they are preventing the correction

of the errors they have detected and that they are doing so

by design. If this becomes transparent, they could be

accused of violating their managerial responsibility.

5. The participants may deal with their personal causal

responsibility by denying it or by assigning it to the domain

of externalities.

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Strategic points of change (Watson’s SPA Model)

• Watson, in Bergquist (2003)

o Structure is all of those organizationally defined parameters and

connections within and through which persons and processes in

an organization carry out the purpose of the organization. It is

the formal and dynamic architecture defined by the organization

within which the mission of the organization is carried out.

o Process is inclusive of functions and activities that are needed to

achieve the results of an organization. It concerns the day-to-

day interaction among those who work in and for the

organization.

o Attitude is the individual and corporate mental and emotional

landscape upon which decisions about the organization and its

process are navigated. It concerns the foundational culture of

the organization, as well as the assumptions, beliefs, values and

personal aspirations that animate and guide those engaged in

the activities of the organization.

Theory-in-use

• Argyris & Schön (1996) p. 13

o Theory of action, whether it applies to organizations or

individuals, may take two different forms. By “espoused theory”

we mean the theory of action which is advanced to explain or

justify a given pattern of activity. By “theory-in-use, we meant

the theory of action which is implicit in the performance of that

pattern of activity. A theory-in-use is not a “given.” It must be

constructed form observation of the pattern of action in

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question. From the evidence gained by observing a pattern of

action, one might construct alternative theories-in-use which

are, in effect, hypotheses to be tested against the data of

observation.

Theory X and Theory Y

• McGregor, in Weisbord (2004)

o Theory X states that most people are lazy, irresponsible,

passive, and dependent, and must have their work broken into

tiny pieces, tightly controlled, and supervised lest they make a

mess of things.

o Theory Y states that most people will take responsibility, care

about their jobs, wish to grow and achieve, and, if given a

chance, do excellent work.

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