Developing an Innovative Culture In a Digital Transformation Environment
Digital transformation environments can be enhanced where there is an innovation culture in place. This is because innovation requires trying new ideas that can lead to remarkable breakthroughs. Experimentation is a core component of innovation, and getting people to take risks in this way requires an innovative culture. This is particularly important within digital transformation environments, where competitive advantage can be achieved through innovative activities.
Changing an organisational culture can be challenging, but it is not impossible. One of the challenges can be that people do not want to fix a situation that they do not consider to be broken. This means that the reasons for the change needs to be clearly understood and communicated well, and behaviour changed so that the change can be embraced. Here are some pointers I recommend to clients to help ensure they can work towards developing an innovative culture in a digital transformation environment.
Leadership and Communication
For any change programme to be successful, including developing an innovative culture, people need to understand why the change is important. This requires leadership clarity and good communication. Managers will need to explain what is being done and why, and what that means for employees. This needs to be done clearly, and it may also need to happen in a variety of ways. Hearing a message repeatedly helps it to sink in, and understanding why helps to reduce fear and resistance around the change.
Employees will invariably follow what the leadership does. Importantly the emphasis here is on “does”. What the leadership says will not matter if they do something different to that. Leaders need to talk the talk and walk the walk. This means that all leaders need to be on board with the change to an innovative culture, to aid the digital transformation. Staff will notice if a manager is saying one thing and doing something else, and they will copy what the leader does rather than what they say, as this demonstrates acceptable behaviour.
If working towards building an innovative culture in a digital transformation environment it is important to engage staff in the activities. It has been estimated and confirmed by numerous research studies that 70% of change efforts fail, and this is often in large part due to resistance of staff. It is important to find ways to overcome this resistance so that staff can become more innovative. This means finding out why resistance is occurring and taking steps to address it. Commonly in a digital environment, resistance may come about as a result of fear of new technology, or a lack of security that could be caused by it, e.g. will I lose my job if this digital transformation is successful?
An innovative culture is one that involves participation and collaborative working. If staff are not engaged with the move to an innovative culture, then the digital transformation program may not achieve everything it might otherwise have. However, resistance can be broken down by listening to staff and getting them involved with the change, encouraging cooperation in cross-functional teams. Ways of working need to encourage the generation of new ideas, that can lead to innovation breakthroughs in the digital transformation environment.
Working towards agile ways of doing things can also be helpful in developing an innovative culture for digital transformation environments. Agile working represents taking a flexible approach towards activities, and continually looking at ways to improve what is being done. This allows people to take unconventional approaches where needed to bring about a breakthrough, while also to step back quickly if a particular innovation is not working. Importantly, this allows results to be delivered quicker than they might otherwise have been, through not remaining wed to ideas that are not working.
Embrace Conflict — to a point
Innovation means coming up with new ideas, and this can only be achieved if people are comfortable with conflict because not everyone is going to agree with one another all of the time. Diverse teams in particular will be likely to experience more conflict. However, they are also likely to come up with the most interesting ideas, as they include many different perspectives on situations. Helping people to adjust to working in teams where there can be conflict is helpful, through carrying out team building activities, and pointing out the risks of groupthink — the latter of which can stifle team work and kill innovation. Take care to ensure that conflict is constructive and working towards innovative causes.
A Note on Risk and Blame
Risk is inherent within an innovation culture. Without risk being taken it may be difficult to move forward. Finding ways to empower people, while taking an acceptable level of control over risk is important so that innovation can occur. Risk can, of course, lead to mistakes being made. Mistakes are good because they can lead to learning, which can drive innovation. However, it is not palatable to have people making the same mistakes over and over again. The organisation will need to consider the level of risk it considers palatable, and put in place suitable checks and controls to avoid sizeable risks, while ensuring that people can take smaller risks in the pursuit of innovation.
On blame, employees will be unlikely to share ideas or take risks if there is a blame culture at the company. Digital transformation therefore will be difficult to achieve in this case. For an innovative culture to flourish people need to feel that when a mistake occurs the emphasis is not on a witch hunt to find out who was responsible and to punish them. Rather, it should be on working out what went wrong, and why, and finding steps to ensure that it does not occur again.
It is difficult to change organisational culture, but digital transformation environments can benefit from an innovative culture to build competitive advantage. Taking steps to lead and communicate effectively with employees regarding the change, as well as implementing agile, flexible ways of working, embracing conflict and breaking down resistance and blame will all help with building an innovative culture that can be transformational for digital programmes.