How to create an empowering company culture – and drive innovation

By Julia Shalet, author of new book The Really Good Idea Test.

Let’s firstly reflect on why innovation is important. We have all heard the phrase “innovate or die”. It means that we need to be responding quickly to changes in our markets to stay ahead of the game. To do this we are dependent on individuals to spot those opportunities and also the organisation to have a culture where new ideas are given a chance to blossom into successful initiatives that have a positive impact on the bottom line. We need our companies not only to be open to the question “What if” but to be able to quickly answer “What next”. Here are three suggestions:

1. Ring fence a fund for innovation to show you are serious

If you keep all your development costs in the same pot, then new ideas may never win out when pitched against proposals for developments where the ROI forecast is far more reliable. By putting aside some money for new idea development, you are signalling to the organisation that you are willing to invest in the unknown. You will show them that, while you have an existing business to run, you realise the importance of staying dynamic, evolving with our changing environment and market.

I have worked with so many teams who tired of coming up with new ideas as they never seemed to go anywhere, this has happened to me too as a product person who was told to “go innovate”. Why ask me to innovate if you are not  prepared to invest?

2. Devolve decision-making powers to allocate that budget 

Now you have a pot of money, you can enable managers who are lower down the organisation to make decisions to award in small increments from that innovation fund. It seems to me that the higher up the organisation that a new idea is presented, the more chance it seems to have of being killed off!

In the early days of an idea we do not need a full business case. There are a number of stage gates for new ideas to go through that need funding at each stage. So I suggest awarding incremental funding, in quite small amounts across a few stages of idea development.

At the very first stage, some simple market research needs to be carried out to gather evidence about

1. Whether the problem, need or desire exists
2. Whether it is big enough to bother building a solution
3. Whether there is an opportunity to provide a better solution than what is currently available

The most commonly cited reason for failure of new products is a misperception of what the customer wants and needs, so this is the most important set of assumptions to test first.

3. Empower people to test out their own ideas 

This is not grand scale market research, this is giving people the tools to go and get initial evidence. It gets people started with just five interviews and a structured research script. I have been helping people to test their early ideas for decades and with a bit of practice, the majority of people really can do this themselves.

Why waste time putting together visions of the solution and business cases based on pure guesswork and pipe dreams? Instead, by enabling people with ideas to carry out some focussed, quick and cheap research interviews themselves, you will help just those validated ideas to be presented when more serious investment is required.

Being able to research ideas is an energising activity; as you gather evidence of problems and find opportunities, you build up a greater understanding of your organisation’s place in the world. It is enlightening and empowering and creates a real positive experience for all those who have done it.

These are just a few suggestions of how to drive innovation into the culture of an organisation so that it becomes part of what everyone does – a way of life. Make it easy for people to progress ideas, remove unnecessary internal barriers and pointless star gazing. Once the door is open to ideas, coming up with ideas may not be the hard part, so empowering teams to carry out quick and easy early idea testing will identify which ideas to take forward. In this way, only really good ideas will move forward as decisions to invest along the way are based on evidence, not hypothesis and dubious business case assumptions.

Forget setting up innovation labs, or internal incubator programs and competitions,  instead try to weave innovation into the fabric of your culture. It is one of  the best ways you can strive to stay ahead of the curve.