Wk 11: Building the innovative organisation

Shared vision, leadership and the will to innovate

-

Articulation of a vision and strong commitment to a shared organisational

purpose
Top management commitment to long term projects
High acceptance of risk (risk calculated)
Creating space and support for innovation
Leadership providing clear strategic direction and often supplying the
vision to take the organisation into new and uncharted waters
Establish an innovation policy
Promote a team climate of emotional safety, respect and joy
Example: Alexander Bell revolutionized the worlds first telephone.
Demonstrated the idea to senior executives at Western Union, which later
received a letter stating that the invention has no commercial possibilities
& they see no future for an electrical toy. Four years later Bell formed
American Telephone and Telegraph (ATT) which grew to become the
largest corporation in the US, with stock worth $1000 per share. The
original patent become the single most valuable patent in history

Appropriate structure
-

Organisation design which enables creativity, learning and interaction

Organisational structures are typically designed for stability
Key challenge is getting best organisational structure for the particular
circumstance

Key Individuals
-

Source of critical technical knowledge

Organisational sponsor (has power and influence)
Project team leaders
Technology gatekeepers
Intrapreneurship should be fostered
Intrapreneurship is entrepreneurship within an organisation, referring to
emergent behavioural intentions and behaviours of an organisation that
are related to departures from the customary
Example: Dyson case page 121 continually persist to perfect his lone
innovation and champion his idea to then became a multinational
organization which is now centralized around design-driven innovative
products now worth over $530mill pounds.

Effective teamwork
-

Clearly defined tasks and objectives

Effective team leadership
Good balance of team roles and match to individual behavioural styles
Effective conflict resolution mechanisms within the group
Continuing liaison with external organisations

Using groups is not always easy, there can be both negative and positive
aspects of using group of innovation
Appropriate use of teams (at local, cross-functional and interorganizational level) to solve problems, Requires investment in team
selection and building
Example : Experiments indicate that teams have more to offer than
individuals in terms of both fluency of idea generation and in flexibility of
solutions developed. Focusing this potential on innovation tasks is the
prime driver for the trend towards high levels of team working in project
teams, in cross-functional and inter-organizational problem-solving groups
and in cells and work groups where the focus is on incremental, adaptive
innovation.

High Involvement innovation

-

Participation in organization-wide continuous improvement activity

Example: Firms like Toyota and Matsushita receive millions of suggestions
for improvements every year from their employees and the vast majority
of these are implemented.
Example: Siemens Standard Drives (SSD) suggestion scheme which
generates ideas which save the company about 750 000 a year. The
electrical engineering giant receives about 4000 ideas per year, of which
approximately 75% are implemented.

Creative Climate
-

Building a creative climate involves the systematic development of

organisational structure, communication policies and procedures, reward
and recognition systems, training policy, accounting and measurement
systems and deployment strategy
Dominance of restrictive vertical relationships
Poor lateral communication
Limited tools and resources
Top down dictatorship
Reinforcing a culture of inferiority

External Focus
-

Open innovation requires building relationships with an extended cost of

characters, including customer, suppliers, collaborators, competitors,
regulators and multiple other players
Enabling elements of effective networks : key individuals, facilitation and
key organisational roles
Internal and external customer orientation, Extensive networking

Wk 6: Leadership for change

Management
-

Planning and budgeting

Organising and staffing
Controlling and problem solving
Produces predictability and order
The managerialist mindset reflects the classical functions of planning,
organising, coordinating and controlling.
Managers are concerned with rationality and control, focusing on problem
solving, and getting things done as efficiently and effectively as possible
Management requires persistence, tough mindedness, hard work,
intelligence, analytical ability, tolerance and goodwill
Managers maintain accountability and limit risk-taking
Managers do things right
The management focus is on attention to detail, ensuring the smooth
running of day-to-day operations, attending to the operational minutiae of
organisational life. Leadership, on the other hand, provides the
overarching strategic focus for the business, articulating a vision for the
business, setting the direction, and motivating and leading by example.

Leadership
-

Establishing direction
Aligning people
Motivating and inspiring
Produces change
To lead means to show the way, to influence or guide others. It infers that
someone is willing to go first and steer followers. It is also someone who is
willing to do things differently and challenge the status quo.
Leading is about actively seek out novel ideas and approaches to issues.
Leaders do the right things
Leaders think about empowerment, rather than control
Leadership is more concerned with developing a vision and setting a
direction for the future, rather than control and detailed planning
Flexibility and adaptability are key modes of the leadership approach, so
as to align people, build commitment and be responsive to changes in the
environment.
Strong interpersonal skills not technical and analytical know-how are
a key contributing factor to effective change leadership
The one quality that distinguishes outstanding leaders from also-rans is a
high degree of emotional intelligence

Emotional Intelligence
- Self-awareness comes from a clear and realistic understanding of oneself
one's strengths, weaknesses, ambitions and needs. Self-aware people
are honest with themselves and with others and, as a result, their opinions
are respected and sought.
- Self-regulation implies self-control, where a person is in charge of their
emotions and does not act on impulse, but considers a situation calmly
and logically before taking action.
- Motivation refers to the drive to achieve and seems to be one trait that all
effective leaders possess. Highly motivated people are motivated by
intrinsic, rather than extrinsic, factors. They exude a passion and
enthusiasm for their work
- Empathy refers to the ability to consider and acknowledge employees
needs and opinions, and weigh these against other relevant factors before
making sensible decisions. Empathy is particularly important in light of the
increasing use of cross-functional, team-based work groups, globalisation
and the need to develop and retain talented people.
- Social skill refers to a person's ability to relate to, and work effectively
with, other people. Leaders with a high degree of social skill develop a
strong rapport with their employees and know how to motivate them.
Dimensions of leadership: the leadership function
Leading change requires balance between:
-

Continuity and change

Short and long term actions
Accountability and freedom
Planning and flexibility

Systemic, big picture approach:

-

Involves employees at all levels in planning and decision making

Encourages cross fertilisation and idea sharing between different ideas

Critical change leadership roles:

-

Energising and mobilising the workforce: into a state of readiness for

change: before they can begin the complex task of implementing
organisation-wide change, need to create a sense of urgency, or a felt
need for change, to gain employees support and commitment. Effective
strategies for creating a sense of urgency are to seek outside opinion, look
at competition and to benchmark against successful companies. By
explaining the change process to staff, highlighting both the opportunities
and challenges that exist and, in particular, involving them in deciding on
and implementing the mechanisms for change, they are less likely to resist
or block the new ways of working. The appointment of a new CEO is also a
strong catalyst for change.

Envisioning the future vision: and defining the direction in a way that
appeals to, and inspires, all stakeholders on a personal level: A vision is
necessary to give meaning and structure to the change efforts. It provides
a focus and a sense of direction, which, while offering a challenge, must
be realistic and acceptable to the majority of the workforce

Demonstrating leadership commitment and involvement: by consistently

and relentlessly communicating and modelling the new behaviours: The
involvement of senior management is seen as fundamental to the success
of the transformation process. It is their role to define the direction, set
performance goals and gain the support of other key stakeholders who, as
champions of the cause, will promote and sustain the change agenda and
help cascade the vision down through the organisation. The last point
underlines the recurring theme that one all-powerful individual, no matter
how charismatic his or her personality, cannot sustain effective change
leadership. On the contrary, successful change leaders recognise that
leadership must be everyone's business and work hard to inspire others
with their honesty, enthusiasm and personal commitment. Communication
by top management is a powerful lever in gaining commitment and
building consensus to required change

Providing enabling systems and structures: that will sustain the

momentum for change: To ensure the success of organisational change
over the long-term, change leaders need to implement mechanisms that
will reinforce and institutionalise change. Integral to this approach is the
establishment of new organisational systems and structures that represent
the new work arrangements and reporting requirements. For example, the
redefinition of roles and responsibilities, changing a company logo,
removing executive perks (such as the executive-only dining room, special
parking areas or a large office suite), holding special ceremonies to
recognise and reward outstanding achievements among staff members,
and tying bonuses to improvements in staff performance

Boulding Three Sources of power

-

Authority power, as in the power of threat or power over:

Economic power, as in the power to exchange or power to
Integrative power, as in inclusive, accepting or power with.
These points appear to support the view that to win over and sustain
commitment to the change process, leading change must be a reciprocal
rather than one-way relationship one that encourages two-way
learning and development. To move from an autocratic, telling style to an
integrative, involving approach clearly requires leaders endowed with high
emotional intelligence (particularly self-awareness, empathy and social
skills), who are able to build rapport and communicate and relate easily
with others.

Charismatic role
- Envisioning: involves providing a clear and compelling vision of the future
that can create energy and commitment across the organisation
- Energising: refers to a leader's personal demonstration of confidence in,
commitment to and enthusiasm for the project

Enabling/empowering: concern both the physical and mental support

given to followers through both symbolic and substantive actions
In addition, leaders energy, enthusiasm and personal commitment,
coupled with a strong belief in the abilities of others, serve to engage,
motivate and energise a critical mass of followers. Kets de Vries argues
that good leadership is about hope, humanity, humility and humour, but it
also takes guts and a dose of narcissism to make the tough decisions. In
his view, the best leaders are not too charismatic and are able, above all,
to put the interests of the organisation before their own self-interests.

Instrumental role
- Organisational design, control and reward
- Explain and demonstrating the behaviours
- Implementing new systems and structures

Complementing leadership style with differing forms of change

-

Developmental transitions (constant change) :This approach is used by

organisations implementing framebending (rather than framebreaking)
change that does not involve a radical departure from existing strategy.
The key to this approach is ensuring the idea of continuous change is
inculcated into the culture of the organisation. This approach is
characteristic of smaller organisations operating in the service industries,
whose focus is on responding flexibly, quickly and innovatively to
customer needs. Coaches whose approach is hands on, people-centred,
consultative and informal, best lead developmental transitions. The
workplace culture tends to be highly cohesive and collegial, with the
emphasis on interdependence, teamwork and collaboration. Coaches show
a strong interest and belief in their

Task-focused transitions (constant change) : Like developmental

transitions, the task-focused approach is incremental in orientation. The
leadership style is directive, however, with senior management framing
and driving the agenda. The focus of this approach is on compliance and
conformity, with the aim of increasing productivity, efficiency and, above
all, profits. Task-focused transitions require captains as leaders. The
directive, authoritative leadership style of task-focused transitions is
compatible with the action and behaviour of business unit leaders in areas
of technical expertise (e.g. law, engineering and accounting) where the
emphasis is on rationality and consistency rather than charisma. This style
of leadership is successful when the followers are in favour of change and
the group mindset accepts a directive approach. Captains at senior
management level also act directively and decisively, although they
encourage consultative leadership at the business unit level (but within a
tightly controlled framework).

Turnarounds (framebreaking change): This form of change is also

revolutionary in nature, taken when the organisation is out of strategic
alignment with its environment and swift, decisive action is necessary for
the organisation's survival. Unlike charismatic transformations, however,
there is no support for this type of radical change. The commander

approach used in turnarounds is topdown directive and, at its most

extreme, coercive in gaining compliance rather than commitment. It is a
tough, hard-nosed strategy aimed at breaking out of the old frame of
reference by creating new structures, getting rid of excess staff and
obsolete systems, and often setting up a new dominant coalition. Its focus
is on making strategic gains first before tackling attitudinal or behavioural
change across the organisation.
-

Charismatic transformations (inspirational change): This approach calls for

radical transformation when the organisation is out of strategic alignment
with its environment and action must be taken swiftly and decisively, thus
precluding participation in the decision-making process by all but the
senior executive. A critical component of this approach is the charismatic
leader who is able to rally support with their inspirational style and thus
create a readiness for change. A second critical component is that key
constituents communicate the need for change clearly and constantly, to
ensure staff understands not only what must change, but also how to
change. As these critical components indicate, a downside to this strategy
is the reliance on the personality of the charismatic leader. It is evident
that leadership training programs and succession planning are important
to good leadership. If a leader, whose strong personality and visible
commitment and involvement have been the driving inspiration for
change, departs without installing a successor with the same views and
management style, then all the good work can unravel very quickly.
Most successful organisations use a mix of change management styles
and scales of change
An exclusively hardnosed frame breaking approach under directive
leadership result in cynicism and distrust
Healthy mix of normative and coercive change tactics required
Combine bold strokes with long matches
Underpins need for leaders adept at both charismatic and instrumental
role

Effective Change Leaders

1. Change the status quo and create a readiness for change
2. Inspire a shared vision and personally communicate the future direction
3. Enable others to act
4. Create additional sponsors at different levels of the organisation
5. Employ symbolic and substantive actions
6. Model the way
7. Communicate the message repeatedly