Retail Observer

RETAILOBSERVER.COM OCTOBER 2022 46 A while back I was serving a public company that had recently created internal brand pillars. During a strategy meeting, I suggested to the CMO that they might want to be careful about naming innovation as a pillar of their brand. "Why's that?" he quickly asked. "Well, because just about every other organization on the planet claims innovation as a brand pillar or core value, but consistent innovation is very hard to live up to, and even more difficult to demonstrate to shareholders in a disruptive sector. Your brand pillars should be both unique to your company and demonstrable over time." It seems like common sense that companies need to innovate. Peter Drucker noted in the '60s that there are really only two core functions to any organization: Innovation and marketing. That acceptable line of logic would make innovation little more than table stakes to doing business. However, having a culture of innovation isn't as common as one might think. Innovation requires experimentation. Experimentation carries a risk of failure. Risk of failure creates tension and uneasiness. And when innovation is successful, companies change. This creates more uneasiness. As a company experiences success, they become less and less likely to experiment, take risks and innovate. This creates a separate source of tension. When forward-thinking team members feel frustrated by the stagnation in a risk-averse organization, they're often seen as pushing against the tide of the status quo. These well- meaning people can unfairly be viewed as trouble-makers. The potential for failure and the inherent change that comes with innovation can terrify people. This uneasiness can feel a lot like the conflicts in our childhood. They are tensions and conflicts we're taught to avoid from a very young age. Those who create a risk-averse culture slowly strangle themselves with a lack of fresh ideas and an unwillingness to confront internal risk-takers, or to face the competition. When a leader is willing to embrace the kinds of risks we're taught to avoid, and when they create a safe space for others to follow, it frees the team from the illusion of safety. This opens a way for the company to grow, change and evolve. Over time, it becomes a habit. When these good habits become the norm, it encourages risk and it creates enough safety for the team members at every level to innovate. So, instead of hanging a brand pillar on innovation alone, I recommended that leaders first work to build a culture that creates psychological safety, and only then build their brand foundation on innovation. Simply said, without the right environment for safe risk- taking, consistent innovation isn't likely to happen. If you feel like you don't currently have a risk-safe culture, what are the obstacles? The usual suspects include: • The Fear Factors. A McKinsey & Company study showed through data the three biggest fears that teams face, along with the five fundamentals that foster innovation. The study revealed three fears that hold back corporate innovation more than others: fear of criticism, fear of uncertainty, and fear of negative impact on one's career. • N.I.H. Syndrome. The "Not-Invented-Here" syndrome is where your company culture believes that all the smartest people already work for your organization, and therefore there's not much you can learn from an outsider's perspective. Essentially, the team believes it has a monopoly on knowledge of its market or industry, which leads it to reject new ideas. • Lack of diversity. In cultures that lack diversity, "group think" tends to predominate. Here, a diversity of experiences, views, perspectives and approaches that could lead to breakthrough innovations is lost. • Lack of a Clear Vision or Strategic Alignment. A clear vision focuses a team on a destination. A strong strategy creates alignment between the people and their collective efforts. With a clear vision and strategy, a team can measure appropriate trade- offs and choose the elements for their innovation system that will match the company's vision. I wouldn't bet against a company that builds strong team trust. There are a million reasons to do so; predictable innovation is only one of them. CREATING A CULTURE OF INNOVATION Steven Morris On Brand Steven Morris is a brand, culture and leadership advisor, author, and speaker. Over his 25+ years in business he's worked with 3,000+ business leaders at 250+ global and regional companies. Discover: https://matterco.co RO

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