Innovation Is Hot!!!!

Feb 10, 2017
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Google’s astonishing success in its first decade now seems to have been almost inevitable. But step inside its systems infrastructure group, and you quickly learn otherwise. The company’s meteoric growth depended in large part on its ability to innovate and scale up its infrastructure at an unprecedented pace. Bill Coughran, as a senior vice president of engineering, led the group from 2003 to 2011. His 1,000-person organization built Google’s “engine room,” the systems and equipment that allow us all to use Google and its many services 24/7. “We were doing work that no one else in the world was doing,” he says. “So when a problem happened, we couldn’t just go out and buy a solution. We had to create it.”

Coughran joined Google in 2003, just five years after its founding. By then it had already reinvented the way it handled web search and data storage multiple times. His group was using Google File System (GFS) to store the massive amount of data required to support Google searches. Given Google’s ferocious appetite for growth, Coughran knew that GFS—once a groundbreaking innovation—would have to be replaced within a couple of years. The number of searches was growing dramatically, and Google was adding Gmail and other applications that needed not just more storage but storage of a kind different from what GFS had been optimized to handle.

Building the next-generation system—and the next one, and the one after that—was the job of the systems infrastructure group. It had to create the new engine room, in-house, while simultaneously refining the current one. Because this was Coughran’s top priority—and given that he had led the storied Bell Labs and had a PhD in computer science from Stanford and degrees in mathematics from Caltech—one might expect that he would first focus on developing a technical solution for Google’s storage problems and then lead his group through its implementation.

But that’s not how Coughran proceeded. To him, there was a bigger problem, a perennial challenge that many leaders inevitably come to contemplate: How do I build an organization capable of innovating continually over time? Coughran knew that the role of a leader of innovation is not to set a vision and motivate others to follow it. It’s to create a community that is willing and able to generate new ideas.

The Link Between Leadership and Innovation

Few companies have the resources of Google at their disposal, but most of them can relate to Coughran’s fundamental challenge. In 2005 we joined together to study exceptional leaders of innovation—how they think, what they do, and who they are. We found them across the globe—in Silicon Valley, Europe, the United Arab Emirates, India, and Korea. And we explored businesses as varied as filmmaking, e-commerce, auto manufacturing, professional services, and luxury goods. We didn’t think the world needed more research on leaders or on innovation. Rather, we wanted to study a topic much less understood: the role of the leader in creating a more innovative organization.

The executives we studied are a diverse lot, but they all think about leadership in a similar way. They have moved away from the conventional view. Direction-setting leadership can work well when the solution to a problem is known and straightforward. But if the problem calls for a truly original response, no one can decide in advance what that response should be. By definition, then, leading innovation cannot be about creating and selling a vision to people and then somehow inspiring them to execute it. So common is the notion of the leader as visionary that many of the people we studied had been forced to rethink and recast their roles before their organizations could become truly and consistently innovative.

The rhetoric of innovation is often about fun and creativity, but the reality is that innovation can be very taxing and uncomfortable.

In the way they behave and structure the organizations where talented people work, leaders can draw out the slices of genius in each individual and assemble them into innovations that represent collective genius. The question is not “How do I make innovation happen?” but, rather, “How do I set the stage for it to happen?”

Why Innovation Requires a Different Kind of Leadership

The rhetoric of innovation is often about fun and creativity, but the reality is that innovation is hard work and can be a very taxing, uncomfortable process, both emotionally and intellectually. In fact, innovative problem solving may feel unnatural and even dangerous in many organizations if their leaders are not skilled.

Innovation usually emerges when diverse people collaborate to generate a wide-ranging portfolio of ideas, which they then refine and even evolve into new ideas through give-and-take and often-heated debates. Thus collaboration should involve passionate disagreement. Yet the friction of clashing ideas may be hard to bear. It can create tension and stress—particularly in groups of talented, energetic individuals who may feel as if there are “too many cooks in the kitchen.” Often organizations try to discourage or minimize differences, but that only stifles the free flow of ideas and rich discussion that innovation needs. Leaders must manage this tension to create an environment supportive enough that people are willing to share their genius, but confrontational enough to improve ideas and spark new thinking.

Innovation also requires trial and error. Innovative groups act rather than plan their way forward, and solutions emerge that are usually different from anything anyone anticipated. Most organizations and the people in them prefer to move systematically toward a desired outcome. They set a goal, make a plan, assign responsibilities, work through the steps, and track progress until the goal is achieved. Isn’t that approach just good management? Not when it comes to innovation. Leaders of innovation create environments that strike the right balance between the need for improvisation and the realities of performance.

Finally, creating something novel and useful involves moving beyond either-or thinking to both-and thinking. But this also can be challenging. All too often, leaders and their groups solve problems through domination or compromise, resulting in less-than-inventive solutions. Innovation requires integrating ideas—combining option A and option B, even if they once seemed mutually exclusive—to create a new and better option. It also requires that leaders be patient enough to let great ideas from people in all parts of the organization develop. At the same time, they must ensure that a sense of urgency and clear parameters allow integrative decision making to actually occur.

Fostering a Willingness to Innovate

To build willingness, leaders must create communities that share a sense of purpose, values, and rules of engagement.

In 2009, when Luca de Meo joined Volkswagen AG as the head of marketing communication (by the end of 2010 he had become the CMO of the VW Group), his task was to transform a fragmented marketing department into an innovation powerhouse. De Meo was energized by the ambitious goal that VW’s CEO, Martin Winterkorn, had set just a year earlier: to surpass Toyota and General Motors and be leading the industry within a decade. This goal was about something deeper than being number one: It was about leveraging a near-century of VW history to create cars that made the world better—by delighting customers, limiting environmental impact, and pioneering what it means to be a 21st-century automaker.

De Meo’s mandate was to build a marketing department that could support this audacious ambition. Although the Volkswagen brand was strong in many markets, de Meo knew it could be stronger. Moreover, the brand was not unified. It was perceived differently across the world, especially in emerging markets, where VW was looking for dramatic growth. A former board chairman of Fiat and CEO of Alfa Romeo, de Meo knew, as he puts it, that “you build a brand from the inside out.” VW’s brand elements—innovation, responsibility, and value—had to be more than rhetoric. The company and its people had to live them day in and day out.

VW operated in 154 markets, and its marketing was highly decentralized. Most of the company’s marketers had worked only within their home countries and had had limited opportunity or incentive to interact with their colleagues in other countries or at corporate headquarters in Wolfsburg. The silos and the “highly linear processes” the marketers followed to do their work discouraged them from speaking with “one voice,” de Meo told us.