Great to read the outcome of an interesting conversation with Rachelle Lee and Michael Zimmel about how innovation and creativity can shape the way finance professionals are looking at their work.
One key pillar for success is understanding how we are creating value for our customers. This starts with exploring who we are creating value for. And then get inspired by their needs and insights. Where are the pain points and how we can we make these groups of people successful.
In the past, finance professionals were routinely creating standard reports piling up lagging financial indicators. In today's ever-changing, complex world this is not creating value. I suggest to look at leading indicators that we can directly influence and have an impact on the success we are aiming for. We can see a huge potential for finance teams to tremendously increase the value they can create for their 'customers'.
Read more in this interview: The Changing Mandate of Finance.
Last week, I posted a small poll to understand how companies are exploring their sources of innovation. The idea of the poll came out of a conversation about that many companies resort to two different types: either they have special teams that are developing new products, services and processes which are then taken up by the core business. Or, the companies are engaging their core business teams to explore new ideas themselves. According to the poll, over 60% of the people experience the latter.
At Hive17 Consulting we are promoting a third alternative that is taking the advantages of both options and allowing the companies to transform with more speed, less resistance and more creativity. Let's explore...
Companies that have established innovation labs complain that the core business is not taking up the new ideas with enough energy. The dedicated teams are great at identifying customer needs and have the resources to deep-dive into the respective markets. Often they are cross-functional and bring diverse experiences to the table, which is strengthening creativity and the creation of novel ideas. At the same time, they are disconnected from the core business and once they have claimed a victory, the company expects that the core business to stem the hard work for the big success. This creates friction.
As an alternative, companies then drive innovation from within their core business. Different initiatives are directed at identifying improvement ideas and developing new products. The core business is close to daily operations and has a good understanding of where we have friction and they are able to quickly implement improvements. Though, they lack the resources of creating a deep understanding of the larger context of the opportunity and often work in their respective silos.
How can we innovate and take the best from both options and drive creativity and operational excellence at the same time?
At Hive17 Consulting we are implementing an alternative we call 'Innovation Crews'. We support establishing small, interdisciplinary teams that are dedicated to a specific opportunity - growing a market, developing a new solution, improving manufacturing excellence, etc. These crews have the resources to deeply understand the ecosystem and bring different silos together. This allows the company to come up with crazy ideas in a short period of time. Because the team size is small, the team is forced to work together with the core business throughout the discovery, identification and development of the solution. This means, from the start the business is involved and contributes to the innovation projects. The innovation crew takes up a role of a facilitator to enable a smooth and accelerated journey towards groundbreaking innovation.
How did you experience the different options to drive innovation in your company?
Today was Day 1 of the APAC Operational Transformation Summit and we had a great lineup of speakers. And we could clearly see a red thread going through all the presentations. Operational excellence is based on digital transformation. And the success of digital transformation is enabled by the people.
First we had Michal Golebiewski from Microsoft sharing how digital transformation is a journey and that starts with the definition of a new you, with a purpose. This purpose is guiding the customers, the partners and the employees on how we are kick-starting this journey. We need a vision & strategy; a northstar. The transformation needs to look at the culture and mindsets that will allow experimentation and stimulate a growth mindset. The unique assets and the capabilities of the organisation need to be aligned for this journey. And finally, success is based on employee empowerment and we need to stay engaged with them. These are the ingredients for success.
Abhishek Sharma, Axa, continued the journey and added that the tools and the process are necessary to make bring fruits from the ingredients. In order to start your digital transformation journey, you need to investigate your what, who, how and the impact you want to create. Important here, you will not reach the peak in the first round. And as a leader, you encourage your team members to climb the mountain by themselves - milestone after milestone. And at the same time, you are there to hold a guiding hand when necessary. This will build confidence. The transformation journey is triggering a cultural shift that involves everyone. THat is why it is important to cultivate trust with your employees, your customers and in the entire ecosystem.
During my presentation, I took the concept further and introduced positive leadership as a model that allows you to drive engagement, motivation and therefore operational success. Today's uncertain and complex business environment requires agility in order to create success. This agility is based on empowering people to experiment, guiding them with a collective dream, creating an understanding how we can create value for our customers, and lastly on building a collaborative platform to facilitate relationships and trust.
Finally, Kesavan Sivanandam, from AirAsia, shared an inspiring story about perseverance and pushing boundaries. Needless to say, the airline industry is hit very hard and AirAsia took this as an opportunity to push digital in the end-to-end experience. He shared the story how strong collaboration with various agencies and business partners allowed them to achieve a contact-less solution from "curb to gate" within a few months time. This was possible based on a common purpose within the ecosystem to keep the business going in a safe way. And in this journey, it was important to keep the people engaged under this collective dream.
Day 1 of the conference was a lot about creating a common purpose, engaging with the people, and cultivating relationships. Key ingredients for a smooth and sustainable digital transformation journey. I am curious to hear more during Day 2.
In my practice to give operational excellence a people-centric angle, I am always curious to learn more about how to experience and influence change. First, it is not possible to force people to change - and I think this is an important notion for any leader. You can only create an environment that facilitates people to change.
Recently I stumbled across this article - How to (Actually) Change Someone’s Mind- that illustrates how we can work together with naysayers that are opposing the change we want to create in our team and company. We all experienced the detractors that seem to be have this deep-rooted resistance to change, right? Here are three strategies that might help.
The cognitive conversation is about holding an objective and positive chat that uncovers new, specific information that can sway the decision into another direction. For success, it is important to consider the existing arguments and to keep emotions out of this discussion.
The champion conversation helps in situation where logic is not an important factor because the underlying relationship is week and is in the way of changing the decision. We want to become a champion in the conversation, get to know the people and allow them to get know you from different angles. For success it is important to stay authentic and continue to rely on logic.
The credible colleague conversation is an approach when deep believes are in the way of change; logical and emotional arguments are not working to overcome deep values. Sharing experiences from another person might help to see that other values are in favour of the upcoming change. The positive aspects from another angle might change deep-rooted opinions.
These types of conversations are not only great when dealing with individuals. The principles also work when designing the journey for large scale transformations: use logic, build authentic relationships, expand people's experiences.
Thank you Laura for putting these thoughts together and sharing these great examples.
There is no magic how to master uncertain times - be innovative, be creative, think out-of-the box! Why is it so hard for many companies to thrive?
This article - How to rebuild a business after the coronavirus lockdown, WIRED UK - shows interesting cases of startups in the UK that managed to turn around and be successful despite the storm hitting the business world.
“Go back to basics,” Hannah Martin says. “Who are your ideal customers, what problem do you solve for them, how has that changed, can you adapt? Approach people, don't wait for them to update you. Look at what others are doing, in and outside your industry, see if you can get ideas.”
Many corporations are stuck in their view of the world, decision makers are too far away from reality, motivation structures are based on lagging indicators, experimentation is discouraged, silos are preventing velocity. Today's leaders need to get out of this cycle to create lasting success.
How do you bring your vision into action?
This week, I have been working with a team to improve their operations. They are doing great at developing new products and services, though they felt unsure about how well they are designing for their customers. For this team, we are looking at a network of internal customers in different functions and business unit. How can we manage these stakeholders needs with agility and creativity?
We started with the 4Qs Framework: who we serve, what we serve, how we serve based on the question who we are. The team appreciated the structure in the thinking process and how this helped to identify where they need to direct their focus. For example, the team said, yes, we know who we are serving. Though, do we know them deep enough, do we know their daily work challenges? Based on this simple framework, we identified the gaps and defined the next actions.
As a next steps we took the discovery principles of design thinking and started the people-centric and creative process of defining the key users, their needs and their pain points. This gave the team a much clearer pictures where the opportunities are to generate value for these people; mapping the existing value propositions with the challenges of the stakeholders. This allowed the team to refocus their operations on the key elements that generate value for their customers.
How are you uncovering the real needs of your customers?
Thank you Anthony Coundouris and Fray Gill.
In the current situation, many companies are stumbling and stuck in the place they currently are - or worse, where they have been in 2019. At the start of the lockdowns, leaders tried to connect with their teams and engaged on a social level. Then, the urge of survival kicked in; many companies started cost cutting exercises. Is this sufficient to shine and thrive at the end of this crisis?
On my side, I am convinced that in order to create lasting success, companies need to focus on value creation. We need creativity to address totally new needs and we need velocity to deliver value at the time it matters most.
In this context it is great to see that major consulting companies are confirming this point of view. McKinsey pushes in a similar direction: Ready, set, go: Reinventing the organization for speed in the post-COVID-19 era.
In the article, they reinforce the notion that we need to re-invent our organisations. Do we expect that 2021 will be the same as 2019 has been? Consumer behaviours are changing, employee preferences have shifted, communication technologies are maturing fast. Here an interesting example: recently, a global alumni organisation was forced to conduct their annual general meeting (AGM) virtually. The organisers shared with me that this format allowed more relevant members to participate and the outcome served the global community better. This was never possible with a physical event. Will they continue with a virtual AGM? Probably yes. Transformations around us are happening fast; and we as individuals and as business leaders need to adapt as well.
McKinsey mentions 9 triggers for speed in your organisation. Autonomous, cross-functional teams with more freedom to make their own decisions, with reduced hierarchy & bureaucracy, and with a clear result focus will execute lasting success. Further, successful organisations are embedding themselves in a collaborative network of partners, customers and suppliers. This means, building a platform that facilitates hybrid work and continuous development of the people is essential to remove barriers. And, what is the role of today's leaders? Enabling, inspiring and empowering these strategic teams. Step back and see success flourish.
How do you create lasting velocity?
In our work, we are supporting teams to strengthen their agility in their daily work; and the start of that journey is not simply to become agile - or faster, rushing. The starting point is that teams and companies are facing uncertainty and complexity - and fighting is not a successful approach in the long run. In this context I came across this article in Forbes written by Steven Denning: The 12 Stages Of The Agile Transformation Journey. Here are my key inspirations.
What do we want to achieve with agile transformation journeys? “The ability of an organization to renew itself, adapt, change quickly, and succeed in a rapidly changing, ambiguous, turbulent environment” as well as “the ability to quickly reconfigure strategy, structure, processes, people, and technology toward value-creating and value-protecting opportunities.”
Can any person in the organisation start working in an agile way? Yes, the principles of agility are applicable for small team as for large companies. Any team can be successful with that. At the same time, the higher in the hierarchy this is started, the better the results.
For the leadership team it is important to acknowledge that establishing an agile mindset and mode of working is a never-ending journey; definitely an initiative or simple project that can be finished soon. Strengthening agility in your organisation is a great learning and development opportunity.
Starting the agility journey should start with a team that represents the diversity of the organisation. Team members should come from different functions and from different hierarchical levels. At the same time, this squad is not about implementing technology. They key focus for this team is improving the business.
Once the first team has shown success, then the journey can grow organically. New teams are inspired to experiment with the new way of working and deliver more success stories. And, in times of failure, stay true to the path you have started; treat those as learning opportunities.
The journey towards agility is not about implementing a structure, new processes, and using different tools. They might simply be means for a new mindset and behaviours. It is important to continuously evolve the idea of being agile for your organisation.
How can I support this journey as a leader? How do I need to evolve my leadership style? As a start, command & control is the antidote to agility. You need to be able to coach and inspire your teams. And agility is based on the delegation of decision-making and ownership.
Maturity in this journey means to master strategic agility; being able to continuously identifying and redefining market success areas - for learning and development.
How did you start your journey towards agility?
In our world, uncertainty and complexity is accelerating - especially in the current situation. At times, we don't even know how the world will look like in 2 months. Some leaders are trying to control and reduce this complexity and uncertainty; is this possible and the right approach? Successful teams, instead, are trying to plunge and thrive in these challenges, and respond with agility.
In my experience, one key barrier for agility is the environment cultivated by the leaders. Are we enabling our teams to experiment and create value within a defined strategic direction? McKinsey created a summary of these leadership challenges. Here is how I would summarise, what leaders have been doing great to achieve success:
a) establishing a clear vision and direction with a focus on results
b) empowering & connecting teams and allocating resources with flexibility
c) embracing a new way of working that allows fast sensing & seizing of opportunities
On a personal level, there are three creative mindsets, we leaders need to embrace - for ourselves and as a role model for our teams:
1) discovery to drive innovation
2) partnership to smoothen collaboration
3) abundance to strengthen value creation
Where will you focus first?
Here the details from the article: Five Fifty: Agility at the Top
Introducing new products in an organisation is an exciting task - we can bring new, added value to our customers. In an industrial setting, this task can be daunting with complex value chains and regulatory hurdles. Yet, to win in today's competitive environment, new product introductions need to be fast.
This was the objective for this project in the textile chemicals space. Led by the global marketing director, the project team took up the challenge to nearly half the time-to-market for product launches. In the past, the company experiences inconsistency in the product lifecycle, top-down processes and system introductions were met by resistance. At the same time, the market and many regulatory changes required more agility. A huge alignment and engagement effort across 18 different functions was necessary.
As the change management practitioner of this project, I worked closely with the project manager on how we can engage the people. How can we involve as many people as possible? What is the best way to convey the business objectives and aspiration? How can we keep the people motivate over the long implementation period for the SAP module implementation?
We decided for a novel approach. Typically, each function will send a few representative and in a large project team they will decide on how the project will be executed. This approach was not satisfactory as large project teams are not effective and still only engage a small percentage of the people involved. The alternative approach we took was creating communities. For each involved function and for each production site we have established one community and nominated a owner for these communities.
Each community owner was then responsible to establish a collaboration routine within their communities and work on assignments related to the global project. The global project team was then working only with the community owners; assigning new activities and collecting input, feedback and comments from the community. In this way, the project team indirectly engaged with about 300 people in a structured, regular fashion.
As a result, all relevant people were involved, engaged and motivated. We often repeated the business purpose of the project to make sure we are all aligned and cross-functional barriers are easily removed. The frequent dialogues established new routines and cultivated relationships across regions and functions. In the end, because so many people were involved in the blueprint design, data migration, user acceptance testing and training of the SAP module, the final go-live was surprisingly smooth and uneventful - a natural next step forward.
As project leaders, we need to be creative and human-centric - this will lead to success. And curious to experiment and try new ways.
How can you apply communities in your change programme?
In my experience when facilitating teams to accelerate their operational excellence, I like to talk about two things. And, they seem to be a contradiction.
"Sustainable change is effortless!" This is similar when you are fixing a screw and at the start it is hard; a simple correct alignment will do the trick and the job is much easier. Many transformation are getting launched with too large climbs and with methods that simply doesn't fit to the style of the people. Too much efforts during a change journey might often be a waste.
"If everything seems under control, you're not going fast enough. (Mario Andretti)" This means that a great challenge creates a lot of excitement and motivation. When we are too comfy, then we are not trying hard enough. Pushing our own limits is actually fun.
How does these two thoughts match? They are helping us to create a balance. Too much push - especially from outside - will drain our energy and is frustrating. Too little effort will make us slow down and kill the momentum. The balance in between will allow us to run at the edge effortlessly and for an infinite amount of time. This is essential to successful transformations.
Where do you find this balance?
Digital transformations are in everybody's mind and talk - the topic of the decade, I would almost call it. And multiple studies are quoted that 70% of them have failed. Is it because we set the wrong targets? Do these initiatives fail because leaders are not committed? Can we achieve success while applying the same processes and methods of the past?
On my side, I like to think of transformations in a different way. Instead of leading people from a situation A to a situation B, I suggest to enable the teams to define and achieve their own change - perpetually as a continuous journey. The based principle in my experience to achieve sustainable and fast success for transformations is intrinsic motivation - with two core elements.
Frame - the first key element provides two things to the team members: a direction and boundaries. There are many names and input for this frame: vision, dream, values, strategy, beliefs... All of them are contributing to ensure that our people are putting their efforts on the right things, established in a collective and positive way.
Empowerment - the second key element allows the people to act fast within the defined frame. The main goal of empowerment is to remove barriers and facilitate speed in achieving the collective dream. This is achieved by providing our people with an autonomy of responsibility which means allowing people to experiment, fail and learn. As a result, we will strengthen creativity and agility - contributing value in a short period of time.
This frame and empowerment is a structure which is best achieved by starting with small steps. First, creating a safe environment to get used to this new way of operating. Team members and leaders alike need to experience the benefits, define how this works best for them and enjoy the journey. Then we can expand this new operating model to more, bigger and exciting challenges.
Where do you see success in digital transformation?
My fellow transformation practitioner, Kamales Lardi, published an article sharing her views on the challenges that occur when executing a digital transformation strategy - Digital Transformation: How to develop strategy under uncertainty. A great list for leaders to understand how we can contribute to successful initiatives. And it made me thought, can we even give it another spin, make leaders bolder?
#1 Create a Confident Leadership Team
#2 Thrive in Uncertainty
#3 Create a Frame for Fast Results
#4 Create a Human-centric Organisation
#5 Implement a Structure that Strengthens Creativity and Agility
Am I the bottleneck to our business success?
How do you translate your vision into action?
Do I appreciate the creativity and insights of all people in our organisation?
Beside reading a lot of Science-Fiction books (inspiration to think far far out of the box) and Wired UK (for the latest tech trends), I am also following McKinsey for their solid insights into the business world. And they have this series of Five-Fifty which are great in today's fast paced world; and this one is about change: Five Fifty: The changeable organization.
Yes, we need to change; and yes, we are afraid and resist change. Still I believe that in order to "manage" change, we need to enable our people and our organisation to define the change and then be excited about it. Here is what the research of McKinsey tells us about this.
How do you prepare for exciting digital transformations?
* Organizational health: A fast track to performance improvement
You heard it enough: a clear vision, a meaningful purpose, a comprehensive strategy is the foundation for a successful business. And why is this so important? I share here an alternative and simple idea.
Today we often observe that teams and entire organisations are pushed to achieve some financial targets - and they all rush, putting a lot of effort to reach these objectives. Is everyone running in the same direction? Are they joining their efforts to create a larger momentum?
In this context, "collective dreams" might be superior to typical lagging indicators:
Where do you success with your collective dreams?
End of last year, we initiated a benchmark survey on how different companies experience their journey to accelerate innovation mindsets. How can we fully exploit our potential to deliver novel products, processes and experiences to our customers. We presented a number of activities and traits and asked two simple questions: are these important for innovation? and are they established in your organisation?
Here are the results of this APAC-focussed survey; they show clear indications on where to put energy and where to start:
Find here the complete survey results: The Current State of Innovation - Report.
Big Thank You to all that have participated in the survey!
In order to be successful in an environment where change and disruption are accelerating, we need to significantly speed up the way we work. Though, success is not achieved with rushing; greater velocity can be achieved with reflection on doing the right thing - slowdown to speedup. Sustainable success is based on creating a frame, empowering people and facilitating intrinsic motivation.
Where do you see these elements in your organisation?
"Live the best life you can. Life is a game whose rules you learn if you leap into it and play it to the hilt. Otherwise, you are caught off balance, continually surprised by the shifting play. Non-players often whine and complain that luck always passes them by. They refuse to see that they can create some of their own luck." - Darwi Odrade
from "Chapterhouse: Dune" by Frank Herbert
On a daily basis, we are pushing our teams for speed and cost. Do we get better, sustainable results? Neuroscience tells us we might be wrong in doing so.
Without going too deep into neuroscience, establishing new mindsets is literally about rewiring our brains. Neurotransmitters from new paths in our mind; this is creating new learning and helps us to transform. Two conditions support this rewiring.
Our brain will only be able to rewire when we are in a positive emotional state; we are open to new thoughts and discoveries. In addition, the new neural paths will be build over time based on repeating the new patterns. One simple and effective way to start is to visualise the positive outcome and repeat towards achieving it.
Instead of creating pressure, engage with our people and discuss with them how success looks like and what actions we think will lead us to this success. And let's have fun along the way.
Source: The Neuroscience of Habits, by Brigitte Najjar (Udemy)
In the recent months, I am very happy to support various teams in getting more agile. Last week, I had a call from one of the sites: "Tim, we have a huge problem! Some of our experiments have failed and some teams can't finish their projects" - "Hey, that's great! What we are focusing on is that we experiment and learn - getting faster along the way."
In a conversation earlier this week we reflected on this. Cultivating an agile mindset not only means applying the processes and methods for developing new solutions. In the example above, the teams struggle with significantly shorter project times and delivering experiments instead of fix deliverables - as usual, this is a journey.
Therefore, we need to experiment and use agility in applying the methods, concepts and processes of becoming agile. Experiment to experiment, be agile in becoming agile - if that makes any sense.
Implementing visionary solutions is like climbing a mountain. And so is to change a mindset of people. Why not using the same approach to take small steps to conquer the summit?
We at Hive17 Consulting are devoted to creating an environment for people to work with passion, engagement and fun via positive leadership and intrinsic motivation. We believe that it takes more than perfect processes, systems, organizational charts and value statements to make your company successful. Our people need to understand, shape and believe in the change journey. And for us, it is clear that this foundation will unleash people’s full potential.
Where is your heart: in Design Thinking? or in Agile? Both concepts are used a lot in the context of innovation and excellence. I heard a lot of arguments from both "camps" which is superior and that the one is a subset of the other - rich discussions.
What most can agree is that the underlying concepts are pretty similar - why not use both? In programs I have conducted - especially in order to become excellent - I have combined them to accelerate creativity and speed.
There is a huge overlap: both concepts are about empowerment, experimenting, minimal viable products, fundamental concepts of agility (arguably from Lean Manufacturing).
Where they distinguish are in two particular areas; and it is good to understand their strength apply where most valuable. Here is how I make the simple distinction.
> Create Ideas: human-centric Design Thinking helps to go deeper in your understanding of the customers and stakeholders.
> Execute Ideas: the strong focus on iterations in Agile, combined with the scientific approach of measuring assumptions are great to accelerate momentum when solutions are implemented.
How do you see the two concepts play with each other?
Last week, the community of Design Thinking professionals met in Singapore. On Friday, we discussed how culture can be influenced and how Design Thinking might support transformation - very interesting question...
I have started to use Design Thinking in order to cultivate customer value focus, agility and cross-silo collaboration. With great success.
Another thought we developed is around intrinsic motivation. Design Thinking facilitates:
* a clear definition of challenges that supports purpose;
* autonomy due to the focus on empathy (button up thinking)
* the iterative prototyping allows mastery (getting closer and closer to the customer needs)
How do you see the connection between transformation and design thinking?
"Instead of forcing change, create an environment where change can happen"
Today, in our production facilities in Thailand we started to discuss how we can execute ideas to improve productivity in a different way: achieve results in a faster way while keeping the big picture in mind.
The excellent outcome of today's workshop was the definition of Focus Topics. We took the solution ideas we created during a Design Thinking workshop in August and modularised them into smaller chunks that can be implemented as minimal viable products. The teams have now selected the first Focus Topic which will be implemented in the next three months. The graphic below vitally supported the understanding of this concept - visualisation is such an important aspect in discovery.
The objective of this approach is not only to create tangible results fast; we also aiming to cultivate agility and a new mindset. Looking forward to see the results soon.
Tim is a change practitioner in the area of innovation and excellence. He is working with teams to accelerate innovation, collaboration and agility.