The Impact of Fear on Innovation

Do you have a culture of innovation in your organization?  Do you need innovation to remain relevant to your customers and competitive in your marketplace?  In a white paper published by McKinsey and Company’s Strategy & Corporate Finance Practice, the authors tackled this subject looking at how fear impacts both employees and managers in their perspectives on innovation.  https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/taking-fear-out-of-innovation?stcr=5207FF9C1DAF456A9B3FE119D20F62D0&cid=other-eml-alt-mip-mck&hlkid=3e12e958e03e49b4b10fc6cec0b593f9&hctky=3130185&hdpid=b27abc36-626b-4c1a-8dbf-420aa9787861
The Impact of Fear on Innovation
“What would you attempt to do if you knew you could not fail?” A quote attributed to Robert H. Schuller and subsequently popularized in TED Talks, self-help books, and management articles challenges us to consider how bold we might be without the fear of failure.
There are three types of fear that undermine attempts to innovate.  “Fear is very personal, but three areas are most pervasive, and they appear among average innovators significantly more than they do in leading innovators: fear of negative impact on one’s career, fear of uncertain outcomes, and fear of criticism.”
Senior leaders are critical to addressing these fears, in both implicit and explicit ways.  For example, the language that is used when discussing innovations that didn’t turn out as well as hoped.  One innovating company refers to them as “pioneering” efforts rather than “pilot” projects, with the implication that pioneers don’t give up but continue their journeys of exploration.  Another refers to unsuccessful innovations as “mis-takes,” connoting that we can learn from these “failures” and take another try.
Culture and Innovation
Culture is a very important aspect of innovation. The McKinsey research shows that leading innovators—companies that outperform in economic profit generated from new products, services, and business models—are full of positive energy, creativity, excitement, and optimism, whereas employees of average and lower performers have a diametrically opposed set of feelings. While these average and low performers still focus on creativity, they lack joy, inspiration, and courage.
Again, senior leaders are key to setting the culture of innovation in an organization – either intentionally or through neglect.  One of our favorite examples of change leadership is John F. Kennedy’s challenge to America with a clear, quantifiable aspiration with interim targets and resources to support it. He defined NASA’s mission as landing a man on the moon and returning him safely to Earth within a decade.  Clear, unambiguous, inspiring, and timebound.
Leadership, a Learning Culture, Innovation, and Intelligent Risk Taking
One of the Baldrige Excellence Framework’s Core Values and Concepts is “Focus on Success and Innovation.”  In the description, it states, “Your organization should be led and managed so that identifying strategic opportunities and taking intelligent risks become part of the learning culture.”  In the Glossary definition of intelligent risks, we find, “Taking intelligent risks requires a tolerance for failure and an expectation that innovations are not achieved by initiating only successful endeavors.”
The McKinsey white paper is blunt about its expectations for leaders to create a culture supportive of innovation and intelligent risk taking. “Commitment. If executives are not fully committed to choosing to grow and innovate, it will not happen. Alignment—everyone nodding and saying, “Sure”—is different than commitment: ‘I’m willing to take people and money out of my organization and put it toward the goal.’” The Baldrige Excellence Framework calls this Creating an Environment for Success.
The McKinsey white paper identifies key cultural elements that most innovative organizations exhibit, and they all relate to the CEO and top team. “It starts with commitment. Does the top team authentically hold innovation as a core value? Leading innovators score three times higher than lagging and average innovators on this. Do they champion innovation and use storytelling to evangelize it? Leading innovators score 4.5 times higher. Do they signal and symbolize that innovation is a priority? Leading innovators are 11 times more likely to use the power of symbols to show employees that innovation is important. Innovation leaders also embrace behaviors and rituals that support innovation, including practicing them themselves, and create a sense of psychological safety.”
Your Challenge
How comfortable are you – personally – with taking an intelligent risk?  How tolerant are you of failures on the part of your employees when they do?  What language is used in your organization to replace blame with encouragement for lessons learned?
Research also shows that fostering innovation promotes employee engagement and customer loyalty. Both are in short supply these days in many organizations. Are you ready to invest in something that yields both?

A special shout out to Northeast Delta Dental, our 25th client to earn the prestigious Baldrige Award!

Read more about this amazing organization.

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