The Top Do-Or-Die Innovation Management Decision You Need To Make

BUSINESS LEADERS AGREE: INNOVATION IS CRITICAL TO SUCCESS

If there's one thing all business leaders agree on, it has to be the need for innovation. The ability to create new goods and services that add exponential value to the business is a hot topic these days. Especially with so much cross-industry disruption going on. It seems as though every established player in virtually every industry is on the defence for a known or yet unknown young, innovative startup.

So be it. Innovation is important. We all want it. We all need it. Alright. Makes sense. Now what?

AND YET, HOW DOES ONE ACTUALLY INNOVATE?

How does an organisation innovate? How does an establish player get to hold their ground and even awaken the sleeping innovation giant within? If all business leaders are in agreement about the need to innovate, well, the other part - you know, the one about how innovation should actually happen - is still up in the air and open for debate. If we had an answer to that one ... oh boy.

Now, there's definitely no silver innovation bullet but there are a number of critical decisions that a management team must embrace if innovation is to flourish within their organisation. I personally believe that most managers do want to innovate and at the end of the day, they even convince themselves that they have indeed done all they could to foster an innovation culture. But alas, something always seems to be missing and every quarter it's back to square one, still looking for that innovative breakthrough.

THE SECRET IS IN HOW OUR BRAIN WORKS

Before we get into what I believe to be the most important innovation decision a management team must make, let me highlight a few facts about how our brain works. It is now common knowledge in the fields of psychology and neuroscience that our brain is capable of two kinds of intelligence. The first kind is the so called crystallized intelligence which you can think of as knowledge a person accumulates throughout their lifespan. This could be skills, experiences or facts acquired through long time learning and memorization. This kind of intelligence grows as a person grows and learns more. Crystallized intelligence is at its core all about facts, data and figures and it can be measured accurately on standardized tests.

The second kind of intelligence is more mysterious and much harder to investigate or measure. That's probably why it's called fluid. Fluid intelligence enables a person to solve problems in creative, novel ways, without any aquired knowledge. It uses the brain's short-term, working memory to store mind states as it works through a solution to a problem and it moves very fast from one state to another. It's not easy to improve one's fluid intelligence, it's more of a matter of genetic inheritance than anything else.

THE CRUCIAL LESSON OUR BRAINS TEACH US ABOUT INNOVATION

So, what does that all have to do with innovation, right?

Hear me out. In a typical 20th century organisation that focuses on facts, figures and charts, crystallized intelligence reigns supreme. The more information you acquire, the more knowledgeable you are. The more MBAs you hire, the more intelligent you are as an organisation. Right? That kind of make sense, doesn't it? Except that the world is not as static as it used to be. We now live in a more dynamic, shall we say, fluid world. You can see how in a static world, where change is the enemy and slow incremental improvements are the norm, crystallized intelligence is what you need. You can measure it, you can track it and you can control it.

The flipside of that is that if your world suddenly changes, then all your static, rigid, controllable structures come crumbling down. And the world is changing indeed. The culture you've built is based on your heavy reliance on crystallized intelligence and in a dynamic, fast, fluid world, that won't cut it anymore. The 21st century innovative company needs to build a new culture based on the dynamism of fluid intelligence. That's scary, I know. But there's no other way. You can't play the innovation game in a static mindset. The game won't adjust. You have to adjust. It's as simple as that.

WHAT YOU CAN DO TO TRANSFORM YOUR CULTURE THIS MONTH

Alright. So the world is fluid and your culture needs to move towards a fluid dynamic as opposed to your old static structures. Fine. But that won't happen overnight. That's obvious. But if it must happen, what can you do in the short-term, say this month, to move your organisation in the right direction?

What's the number one management decision you can make right away to move your organisation towards a dynamic, fluid, innovative culture?

Here it is. Ready?

Merge your Product Management team and your Development Management team into one single Product Development Management team.

Now, chances are, your have two separate management teams. They might even sit in different locations or timezones. If your Product Managers and your Development Managers are two separate entities, the first thing you need to do is merge the teams. Now, let me be very clear on this point. I don't mean sit them in the same office. I mean make them the same person. You need Product Development Managers. If your Product Managers are technical enough, turn them into Product Development Managers. If they're not, move them to another team. Or fire them. If your Development Managers are business and marketing savvy, turn them into Product Development Managers. If they're not, move them to another team. Or fire them.

Chances are, neither your Product Managers nor your Development Managers will fit the Product Development Manager role. And here lies your number one innovation management dilemma:

Do you keep Product and Development separate or not?

It's up to you.

Just remember this. When our Fluid and Crystallized Intelligences merge, our brain enters a highly productive unified state and that's when the world's greatest masterpieces come to life. I believe that an organisation works the same way. When Product and Development become one and the same, that's when you're setting yourself up for real breakthrough results.

That's when you're beginning to tap into the true power of innovation.