Want Business Agility? Use These Seven Innovation Principles

I'm rewriting/reorganizing the Lead an Innovative Organization book. I realized I have 7 innovation principles:

  1. Clarify the organization's purpose. 
  2. Manage for effectiveness.
  3. Seek outcomes, not outputs.
  4. Flow efficiency at all levels.
  5. Encourage small-world networks of relationships.
  6. Organizational integrity.
  7. Encourage change and experiments.

Anytime I've seen a successful innovation culture, I've seen these principles. (I'm trying to understand if transparency is a part of one of these principles or separate. I need to write more.)

Let me address a little about business agility and innovation.

Business agility allows us to create a culture where we plan to change. We make change easy.

Too many people think business agility is about the ability to do more of the same, faster.

But, if you know your market won't change, and you know your customers won't change, you don't need business agility. You don't need experimentation and discovery. You do need to remove barriers to fast delivery:

  • Fast product decisions at the start and to not change them until the teams deliver.
  • Fast project portfolio decisions and short projects so you don't need to change what the teams work on until the next decision cadence.
  • Sufficient test and deployment automation so the teams can evaluate the correctness of their work and deploy that work.

I don't see too many organizations like this. Instead, I see many organizations that need to experiment and discover.

Short Intro to Each Principle:

Clarify Organization's Purpose:  When the organization clarifies its purpose, everyone understands which work is in scope and what is out of scope. People can decide to experiment to learn if they should expand or decrease scope for feedback to the purpose. But, purpose helps everyone focus on the work to do and not do.

I don't mean those vapid “best in class” idiotic statements. No. I mean something like, “Organize the world's information” or “Get people and their luggage to their desired destination.” Or mine, “Explore and support effective ways of managing product development.”

Manage for Effectiveness: Recognize that we decide what to do before how to do it or how to make “resources” more effective. Deciding what not to do is often more effective than trying to be efficient. (Because of cycle time delays.)

Seek outcomes over outputs: It doesn't matter how many hours people work (or where they work). It matters how well the team can create value. (Applies to management teams, too.)

Flow Efficiency at All Levels: The faster managers make decisions, the easier and faster the teams can deliver great work. Instead of optimizing for a team's agility, we can encourage management agility with flow efficiency. (And, get rid of the performance management nonsense that reinforces resource efficiency.

Encourage Small-World Networks of Relationships: I find many hierarchies stifle innovation. Problems have to go up, across and down—and then back again—the organization for solutions. When you trust adults, they often discover people around the organization who will offer help. Especially if you don't reward individual behavior.

Organizational Integrity: We can eliminate most of the policies and procedures that add time and make people crazy. We can choose to respect people and still maintain reasonable guardrails that help people make good decisions.

Encourage Change and Experiments: When we manage for change, we tend to create smaller experiments we can learn from. That means we look for data that informs our next steps.

I'd like feedback. Do you see something else, either instead of or in addition to these principles? (As I said, I'm struggling with transparency.) Thanks so much.

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