Innovation agile-on-the-beach

Growing a culture of innovation James Lewis

Introduction

Who am I? James Lewis Engineer, TAB

TAB TechnologyAdvisory Board

virtual body TAB Technology Advisory Board

virtual bodyface to face twice a year TAB Technology Advisory Board

virtual bodyface to face twice a year TAB all things technical at ThoughtWorks Technology Advisory Board

virtual bodyface to face twice a year TAB all things technical at ThoughtWorks Technology advisors to the CTO Advisory Board

next edition ~ 6 weeks

a talk in three acts...

a talk in three acts...Act I whats all the fussabout?

a talk in three acts...Act I whats all the fussabout?Act II traditional methods

a talk in three acts...Act I whats all the fussabout?Act II traditional methodsAct III innovation done right

Act IWhat’s all the fuss about?

new competitors, global markets

lean startup

Lean Start Up Principles! Entrepreneurs are ! everywhere" Entrepreneurship is management" Validated Learning" Build – Measure - Learn" Innovation Accounting" "

So far, so hipster

it turns out thatorganisational health is a competitive advantage

• “Organizations that focused on performance AND health simultaneously• were nearly twice as successful as those that focused on health alone,• and nearly three times as successful as those that focused on performance alone.” Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage, Scott Keller & Colin Price (McKinsey & Co.)

Surveys: 600,000 respondents, 500 companies6,800 CEO’s & senior executivesReviews: 900 books & academic journalsPersonal interviews: 30 CEO’sData from: >100 McKinsey clients Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage, Scott Keller & Colin Price (McKinsey & Co.)

intangible assetsare becoming much more valuable

this is recognised on your balance sheet

these are recognised in market capitalisationphoto of intangible asset - people or something

Impact of Intangibles on Market Value Year Intangible % Tangible % 1982 38 62 1992 62 38 2000 85 15How Leaders BuildValue,Ulrich & Smallwood

what sort oforganisation are you?

Act II the usual approach

explore vs exploit

we often start value driven and become cost driven

we often start value driven and become cost drivenexploring exploiting

established corp, founded 1955

established corp, founded 1955Uses punch cards and tapesFirst in the industry to …Rapidly gaining market share X

established corp, founded 1955 X

established corp, founded 195550 years on... X

established corp, founded 1955 IT is a cost centre One developer is much the same as another and one language is much the50 years on... same as another Standardisation and cost-control are key factors X

newandcool.com, founded 2012

newandcool.com, founded 2012-Operating procedures adapt to suitdemand-Finding and keeping the best developersoffers a competitive advantage-Anything that gives faster time tomarket at high quality is worth doing-Innovation and value-delivery are thekey factors X

newandcool.com, founded 2012 X

newandcool.com, founded 2012now what? X

do you allowyour people to innovate?

do you allowyour people to innovate?how do you measure them?

its relativelyeasy to measure “performance” money saved utilisation story points delivered

and therefore usual to incentivise based on this money saved utilisation story points delivered

but innovationis difficult to measureso incentivising for this is really, really hard

agent theory

Agent theory agent theoryyou perform an activity; I pay you

but what if iwant you to dotwo things..?

performance innovation

performance innovation strong measuresstrong incentives weak measures weak incentives

so which activity are you going to perform?

so, we are<beep> then?

Act III innovationdone right?

Daniel Pink, Drive: The Surprising Truth about What Motivates Us

high commitmenthuman resources

The Modern Firm, John Roberts, 2004

“egalitarian values and norms”

run asustainable business

run a revolutionisesustainable IT and business champion software excellence

run a revolutionise advocatesustainable IT and passionately business champion for social software and excellence economic justice

“rigorous pre- employment screening”

Valvecertainlybelieve inthis

“self-managing teams”

the role oforganisational design

1992 2000

failing logistics EU’s highest rubber failure led to market boots stock price capitalisationmanufacture cut in half1992 2000

failing logistics EU’s highest rubber failure led to market boots stock price capitalisationmanufacture cut in half

“Why have we been a successful company?If you want avery simple answer, it is getting the balance right between innovation and execution” Jorma Ollila, Nokia CEO failing logistics EU’s highest rubber failure led to market boots stock price capitalisation manufacture cut in half

“a strong culture focussed on anoverarching goal”

mission drivenorganisations

Summary

“Those are the only two choices. Win by being moreordinary, more standard, and cheaper. Or win bybeing faster, more remarkable, and more human.”--Godin, Seth. (2010). Linchpin: Are You Indispensable?

peoplearchitecture routinesculture

• What type of organisation are you? • exploring? • exploiting?

• What type of organisation are you? • exploring? • exploiting?• Focussing on health as well as performance is crucial in our global marketplace

• What type of organisation are you? • exploring? • exploiting?• Focussing on health as well as performance is crucial in our global marketplace• Be careful what you measure, because that is what you will get

• What type of organisation are you? • exploring? • exploiting?• Focussing on health as well as performance is crucial in our global marketplace• Be careful what you measure, because that is what you will get• for knowledge work, maybe high commitment HR can help

you can’t build a culture of innovation

you can’t build a culture of innovationbut with purpose and leadership you can put the routines and architecture in place for it to ﬂourish

Thank you! @boicy http://bovon.org jalewis@thoughtworks.com

is hiring @boicy http://bovon.org jalewis@thoughtworks.com

Innovation agile-on-the-beach

by James Lewis on Oct 03, 2012

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