Tearing Down Knowledge Silos: How Changes in Science Should Impact Corporate Innovation

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In a recent feature at Big Think Daniel Honan detailed an ongoing shift within the field of biology – a move away from strictly compartmentalized disciplinary boundaries within large university and public R&D laboratories to smaller, more nimble inter-disciplinary labs. In discussing the featured example, Mount Desert Island Biological Laboratory (MDIBL), Honan describes the opportunities that mixing scientists of varied background in an open lab will provide. In a number of ways, this new lab paradigm mirrors what needs to happen for corporations to, as stated by Kevin Strange, head of the MDIBL, “speed the pace and reduce the cost of discovery.” In revamping what used to be a seasonal lab into a medium-sized academic unit with a budget of $10 million and a staff of 50 employees of varied background Strange has created a very powerful incubator for innovation.

In the face of continued cut-backs to R&D many leaders in corporate environments are struggling to do more with less. Besides utilizing the principles of open innovation to leverage knowledge outside the firm, perhaps there are some other lessons to be learned from the above example to assist the Osmotic Innovator in building an innovative and productive team.

Beware if this is what your organization looks like.

Unfortunately for the corporate innovator, creating and moving a cross-disciplinary team of 50 to a remote lab to accelerate the pace of innovation isn’t likely to be met with much enthusiasm from your superiors. Start-ups, with narrow budgets and a bee-line focus on commercialization in the current VC culture, are unlikely to have the necessary breadth to emulate this model even if they have advantages in their location. So, how could this model be recreated within the corporate environment AND targeted toward meaningful innovation within a company’s strategy?

–         Hire the right people: it has been discussed on this blog before, but it is important to rehash the importance of building a team having a wide variety of skill sets. However, this principle needs to go further than just hiring one Chemist instead of a Biologist or a fresh out-of-school generalist in place of a 20 year specialist. People of varied backgrounds and viewpoints are also necessary to build a culture that can support innovation.

–         Make collaboration a necessity: the MDIBL forces its scientists to collaborate in order to move science forward and survive in the ‘publish or perish’ atmosphere of academia. The Osmotic Innovator has a number of tools to execute this, from the straightforward, such as arranging project teams to fit the model, or to the indirect, such as rearranging the floor plan to encourage spontaneous interactions.

–         Encourage experimentation: 3M famously does this by giving researchers a set amount of time to pursue personal interests, even without a commitment to such large fractions of time innovation competitions or challenges can build this type of thinking.

–         Find a way to be agile: Process is important, but having the ability to rapidly change focus, whether it be a large initiative or small project, is equally important when trying to improve the capacity to innovate. Be willing to scrap process when reasonable to boost your teams’ effectiveness in responding to new challenges or opportunities.

Organizing and operating exactly like a small research facility is perhaps an idealized view of how a research department or company can operate. However, there are a number of lessons in these models that we can learn from and leverage within our teams to improve the capacity to innovate even without massive budgets or staffs. The next time you’re wondering how a small academic unit scores big with an important discovery in the face of diminishing resources, think instead about how you can emulate their best characteristics within your team.

Implementing Culture Change to Drive Innovation

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As discussed in a post last week, innovation is in part a cultural phenomenon – something that is in a lot of ways the antithesis of the culture that naturally appears in a successful firm over time. But its easy to change the culture to harness innovation, right?

You can’t be blamed for believing this, with the plethora of books and management consultants touting numerous ‘can’t fail’ ways to change the company culture from the CEO down as a way to boost innovation and create a renewed energy. Unfortunately, this is a lot easier said or written about than done. And what about those of us that work in a company that either thinks it is already innovative enough or has no interest in changing what works now for the larger corporation? How can an individual create real organizational change to increase and drive innovation without the power of the CEO to direct internal marketing campaigns and HR efforts?

As companies grow they require increased systems, processes, and hierarchy in order to manage the growth and control profitability. Eventually, this driving force becomes self-sustaining – with success comes bureaucracy (perhaps necessarily) and people that function well within a structured and organized environment. Eventually those innovative and driving employees that were the root of the success of the company either change to fit into the new dominant culture or are forced out. We justify this by saying that they aren’t a cultural fit anymore. At some point though in the progression of most firms it will become necessary to shift the culture to recapture that innovative spirit, at the very least within individual business units or groups that are looking for growth and new opportunities.

To understand how to impact the culture to improve innovation we must first understand two aspects of culture that can limit innovation:

Shared Beliefs: In most organizations, as a result of the filtering process that occurs during hiring and induction and that continues through teams shared experiences a strong set of shared beliefs will appear. These can be a strong tool to strengthen a corporation, leading to more delegation, decreased monitoring, higher satisfaction, higher motivation, faster coordination, and more communication, but importantly, also to less experimentation and less information collection.[1] Experimentation and information gathering are at the core of innovation, so while shared beliefs can be great for the corporation they can also severely limit innovation for a team.

Focus on Process Excellence and Cost Cutting: As stated above, a successful firm will have developed a strong bureaucracy by the time change for innovations sake is necessary. A focus on strong process excellence and cost cutting (along with out-sourcing and quality) are essential to deliver consistent returns to Wall Street. However, they are also an enemy of innovation as they look to eliminate complex projects that don’t fit the model and discourage high risk activities that require investments of time and money.

Knowing that these two things; Shared Beliefs and Focus on Process Excellence and Cost Cutting are major parts of the problem is only the start. How might the Osmotic Innovation change their team using this knowledge?

Disrupting Shared Beliefs: One cannot eliminate all sources of shared beliefs – so long as employees work together they will gradually build this characteristic. However, manager selection of employees plays a very strong role in sustaining shared beliefs. By selecting employees that are ‘culture fits’ or that think like the manager they sustain and strengthen this culture. Hiring people that are viewed as cultural risks while having the right skill set is one possible way to shift shared beliefs to encourage more experimentation and information gathering. Note that these should be people in important positions – having a few crazy technicians won’t disrupt the way that a group of managers or senior scientists think. It has been shown that culture and shared beliefs tend to flow from the important people within an organization so an even easier mechanism might be to put those who are willing to buck the status quo in your current organization into positions of responsibility and power or appoint them to take a lead on innovation initiatives.

Really Focus on Innovation: Because most employees see their compensation and reward systems being tied to the values of process excellence, cost cutting, and quality finding time or initiative to work on innovation or the willingness to support high programs is unlikely. Instead innovation needs to become part of everyone’s day-job, and should be tied to their annual performance / compensation reviews. This shows the commitment to innovation that can encourage creative employees to begin committing to new ideas and innovation. As was learned in the 1980’s at the joint Toyota-GM NUMMI venture, changing culture starts with changing what people do – the new way of thinking will come.[2] John Shook has described this in a model based on Edgar Schein’s original model of corporate culture; shown to the right. Apply this lesson by making employees responsible to deliver innovation as part of their job function. The new way of thinking (and culture) will follow. Merely advertising a new motto or idea to change peoples thinking isn’t enough to change values and attitudes and what people really do.

Short of wholesale changes driven by the CEO and Board, culture change to increase innovation can be managed and implemented within smaller parts of the organization by recognizing the key factors that drive and develop culture. Disrupting the entrenched belief systems to encourage experimentation and new knowledge gathering along with making innovation a measured part of a teams job function can be the levers used by the Osmotic Innovator to change a team or organizations culture from the ground up.

[1] Van den Steen, Eric. On the origin of shared beliefs (and corporate culture) RAND Journal of Economics. Vol 41, No.4, Winter 2010. 617-648.

[2] Shook, John. How to Change a Culture: Lessons from NUMMI. MIT Sloan Management Review. Winter 2010, Vol. 51, No. 2. 63 – 68.