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by Ellen Pearlman
Strategic Thinker: Gary Hamel
Credentials: Co-founder of Strategos, an international consulting company; Visiting Professor of Strategic and International Management at the London Business School; Director of the Management Innovation Lab
Big Idea: Innovation is everyone's job
Book: The Future of Management, written with Bill Breen, published by Harvard Business School Press, October 2007
Blog: Management 2.0
Innovation guru and strategic thinker Gary Hamel argues in The Future of Management
that bold management innovation is needed now more than ever. The old methods of control and efficiency are simply out of date. "Most of the essential tools and techniques of modern management were invented by individuals born in the 19th century," he says. "To thrive in an increasingly disruptive world," he explains, "companies must become as strategically adaptable as they are operationally efficient." Furthermore, to protect their margins they must become "gushers of rule-breaking innovation," and to out-invent and outthink the growing number of upstarts they must learn how to "inspire their employees to give the very best of themselves every day." None of this, of course, is easy and the corporate role models are few.
Hamel says that the most critical question every 21st century company needs to ask itself is this: Are we changing as fast as the world around us? He suggests that many companies would have to answer "no." Most "deep change" that companies undergo is crisis-led and episodic. Rarely, notes Hamel, is it opportunity-led and continuous. A turnaround, he says, is "transformation tragically delayed." The goal for 21st century companies is to build an organization capable of "continual, trauma-free renewal."
What factors contribute to this strategic inertia? Hamel names three roadblocks:
"The first is the tendency of management teams to deny or ignore the need for a strategic reboot. The second is a dearth of compelling alternatives to the status quo, which often leads to strategic paralysis. And the third: allocational rigidities that make it difficult to redeploy talent and capital behind the new initiatives."
In a world where the pace of change is dizzying, innovation has to be everyone's job. Is innovation a buzzword in your company? Do all ideas come from the top or a small group of anointed "creative" thinkers? To figure out how your company rates, click here to get 5 questions to ask entry-level employees in your company. Then decide if your company supports innovation or not.
Also of interest: "How companies approach innovation: A McKinsey Global Survey", The McKinsey Quarterly, October 2007.
Executives now firmly believe that innovation is central to a company's strategy and performance, but getting it right is as hard as ever, according to a recent McKinsey Global Survey, and often their companies' approach to it is informal, and leaders lack confidence in their innovation decisions. Read the article.
Are You Innovative? 5 Questions To Find Out
Is innovation rhetoric or reality in your company? Ask a few entry-level employees in your company the following questions and then decide:
1. How have you been equipped to be a business innovator? What training have you received? What tools have you been supplied with?
2. Do you have access to an innovation coach or mentor? Is there an innovation expert in your unit who will help you develop your breakout idea?
3. How easy is it for you to get access to experimental funding? How long would it take you to get a few thousand dollars in seed money? How many levels of bureaucracy would you have to go through?
4. Is innovation a formal part of your job description? Does your compensation depend in part on your innovation performance?
5. Do your company's management processes-budgeting, planning, staffing, etc.-support your work as an innovator or hinder it?
Reprinted by permission of Harvard Business School Press. Excerpted from The Future of Management by Gary Hamel with Bill Breen. Copyright (c) 2007 Gary Hamel; All Rights Reserved.
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