Giving It Away To Win: From Power Push to Viral Pull

One of the core contradictions at the heart of change management is the idea that for a new idea to be successful, leaders must sign up to the proposed change. The problem is, how can you be committed to a form of change that you have never experienced and which will devalue your carefully-acquired Relationship Capital?

It’s important to recognise the viral element of successful change management. Sometimes, as with products, it’s a good idea to be a fast-follower who can exploit the pioneer’s market creation. One of the most dangerous things that can happen to an organisation is when a CEO takes a long flight and gets time to think without distractions, or is invited to speak at a conference and gets infected with a new idea for changing or improving a business’s performance. What happens next probably explains the 70% failure rate of first-wave systemic change methodologies, and is a further demonstration of what happens when a change-agent tries to pretend that they can be effective without building Relationship Capital:

• Someone has a “vision” for an improved business, and hires a change Practitioner “who’s done it before”. This Practitioner thinks they have a mandate for change, but it’s merely an understanding that will flex when circumstances change.
• The Practitioner builds a “Machine” to deliver the change, which turns into a new function (aping current organisational behaviour, in order to survive among the competing functions) and becomes an overhead. 
• The Machine starts constructing metrics to look good and attacks the Low-Hanging-Fruit (LHF) to justify the investment; the Machine’s purpose mutates into feeding itself, looking for good stories of its work among the functions (which alienates the functions by suggesting that it was all down to the Machine); it becomes disconnected from the business.
• The Business gets pestered by Machine consultants who keep arriving to do stuff and distracting its people. The Business functions begin to question having to pay for feeding a Machine that’s increasingly seen as disconnected from the Business, and leaders start blocking any moves away from LHF into systemic change. 
• The Machine creates its own efficiency numbers to demonstrate activity and apparent benefits. Business functions gang up on the Machine, or a crisis occurs and the Machine is closed down, or quietly dies a death. Things go very quiet.
• Then (after an interval of time, with luck) an Internal Business Visionary rooted in the real world of the Business functions starts it up again BUT at a lower level within their own function. This internal visionary has learnt from the failure of the Machine that fed itself to death, that change has to be business-focussed and initiated and should not try to ape the clothing and behaviour of the Business functions.
  

The change lessons could turn out to be:

1. Let someone else fail and then follow them, or work with someone who really wants to do it. It’s not about doing it TO the business, but for the Business to do it TO and FOR ITSELF.
2. If you build a change Machine to compete with the Business functions, they will have to destroy you at some point.
3. The Practitioner who succeeds in the long term will give away their practice and focus on maintaining a Centre of Excellence and the development of thought-leadership, learning to act as a guide, and not as a Machine builder or driver.

The Pace of Innovation Leadership

At last a Knowledge and Innovation Management Book in the military context.

I must recommend Mark Urban’s recent book “Task Force Black” (‘The Explosive True Story of The SAS and the Secret War in Iraq’: Little, Brown; 2010). What appears to be another book about the war in Iraq, is actually a book about Strategic Knowledge Management and a leading practitioner.

What is fascinating about Urban’s account of the Special Air Service contribution to the “hidden” war against Al-Qaeda and related insurgent groups are the innovations around knowledge management that Stan McChrystal wove together, which have potential for establishing and maintaining innovation leadership within a volatile global market.

It is the integration of surveillance technologies, elite teams, and information management to change the pace of decision-making that is noteworthy. Major-General Stan McChrystal realised that it would take a military social network to defeat a cultural insurgent network, and consciously accelerated the pace of data-gathering and interpretation, cutting out the traditional siloed, and layered, “Chinese Whispers” migration of intelligence aggregation, analysis and synthesis through creating his own intelligence network, with its own media in the form of intranet spaces to display it in, that could be accessed and interpreted by participants in real time.

Fundamentally, McChrysal consciously took Boyd’s OODA loop philosophy out of its traditional air combat context (Boyd’s fighter-pilot proposition being that in order to win in air combat, the first combatant with a superior pace to their Observe-Orient- Decide- Act cycle, is the winner), connected it with energy and applied it hunting down insurgent cells, to roll up structured networks faster than they could respond, and thus “win” or at least destroy the opposition’s ability to dictate the pace of the war.
Implications

If we simplify innovation thinking to at least 3 basic thinking rules: move, test, and break; then McChrystal and his disciples have added a fourth element to demonstrate that so-called “asymmetric” networked warfare can be defeated, as long as military leadership has the courage and energy to
1.Move: consciously changing perspective –to empathise, to think like an insurgent, understand where and how they are being manufactured, as well as their victims;
2.Test: explore current assumptions around purpose, context and rationale for yourself and the insurgent, remodelling these to work with better assumptions, deliberately discarding obsolete thinking and structures; and finally:
3.Break: consciously game-breaking or changing the rules to create new opportunities, recognising when to flex your rules of engagement, when and at what pace to change the rules of the current game, in order to win.
4.Up the Pace: use 1-3 to change the quality of thinking and decision making whilst accelerating the pace of decision-making, so that the opposition cannot compete with you.

Sticky Organisations and How They Make Smart People Stupid

The thrill of being headhunted to a senior role in a successful and knowledge-intensive corporate on the basis of expertise is only balanced by the downside of finding yourself trapped in a cycle of ritualised meetings, unable to influence the strategic direction of the organisation that paid the recruiter so well to recruit you. In such a situation, several options become available:

1. Lie back and enjoy the management cycle of activity (like pedalling a static exercise bike with minimal resistance).
2. Get upset about the fact you have become a corporate adornment, that you can’t influence the strategy, become cynical and constructively dismiss yourself, or
3. Try to understand the situation, and do something about it.

Let me explain the relationship between a “sticky” organisation and Relationship Capital.

• All cultures are relatively “sticky” in the sense that they resist pressures to change.


• A culture is a by-product of a technology stabilization process, it is composed of the problem-solving experiences and processes involved in turning an invention into an innovation.


• Strong cultures continually evolve new behaviours to block change, to maintain social stability and power structures based upon existing patterns and accumulated reserves of mutual Relationship Capital.
  
• The greater the mutual Relationship Capital in the network, the “stickier” the organisation.

Relationship Capital is the social “capital” you build through establishing positive impressions and trusting relationships with key colleagues, stakeholders and potential internal customers, through trading and being able to bank favours at crucial times in the lifecycle of the business and personal careers. It explains the tendency within major corporations and political parties to appoint that “safe pair of hands” who turns out to be a dangerous idiot instead of the innovator who wants to move the strategy in a new direction, to change the rules. That “safe pair of hands” is usually the manager who is owed the most in Relation Capital transactions, the value of which would disappear if the technology and direction of the business changed and made the existing transactions void.
This explains the tendency to optimise existing products, services and business models instead of moving into the territory of creating genuinely new value by focusing on becoming effective. If you hold a big account of Relationship Capital, would you want to give it up? This also explains the 60-70% failure rate of systemic change programmes. When you change organisations, you make existing Relationship Capital void.

The message is: If you are a subject-matter expert or even a thought-leader, you cannot put your knowledge to work within a “sticky” organisation unless you can rapidly develop Relationship Capital. Without Relationship Capital, you will not be invited to the “right” meetings where you can make a contribution based upon your hard-won expertise.

The personal strategy that applies, involves enduring a rite of passage in meetings, negotiating deeper stages of trust, where your behaviour must be positive without appearing to threaten existing knowledge power and established Relationship Capital in the room. These will involve working your way through a sequence of meetings, demonstrating your respect for existing Relationship Capital, meetings where provocations to your expertise will be offered but to which you must not react.

Simplified Relationship Capital Building Labyrinth Sequence

Level 1 Meeting: Wrong Problem / Wrong Method
Level 2 Meeting: Right Problem / Wrong Method
Level 3 Meeting: Wrong Problem / Right Method, and finally
Level 4 Meeting: Right Problem / Right Method

The Expert’s Journey to Effectiveness

Ideally, an expert would be allowed into a meeting level 4 meeting from the start. In reality, the expert goes through a rite of passage (1, 2, 3 level meeting types) to socialise them, test their “right stuff” and their willingness to respect the primacy of existing, dominant (but often decaying) knowledge forms and their established Relationship Capital. Once you have developed high Relationship Capital, you will get invited to the real meetings that determine survival. It may take 18 months of self-control and sticking to the rules.
This explains why genuine “out-of-the-box” or even “no-box” thinking needs leadership sanction or a major crisis of survival that wipes out the bankability of existing Relationship Capital.

The Rules

1. Respect existing Relationship Capital, find out who has the most banked and whose is most at risk.


2. Don’t preach using your Craft Knowledge to define the problem or appropriate solution or techniques.


3. Use their language to define the problem they want to work on: don’t be surprised if they want to solve the wrong problem. Help them to do the wrong thing, better.


4. Don’t explain where an enabling technique comes from, pretend to invent it on the spur of the moment.


5. Try to use local contextual examples rather than using comparative case studies of external practice.


6. Be patient and control your body language.

I will be talking about this at the Henley KM Forum Conference on 24th February 2010.

The Art of Innovation Leadership

Innovation Leadership is an art because it involves understanding and managing 4 behavioural dimensions which have, until recently, remained hidden. Whilst we are probably familiar with Sun Tzu’s and Marcus Aurelius’s maxims on the importance of self-knowledge, the psychology of Innovation Leadership has not been available in a practical form that could help leaders and organisations, until now when we need it.

Blind Drivers of Innovation
Understanding innovation leadership is a bit like driving a car. At present, most organisations manage their psychology of innovation like drivers of cars who happen to be blind. It is possible to become relatively successful at leading an organisation through the medium of traditional performance measures. These are much like the cues that a blind driver uses to stay in the correct lane on the motorway. By listening to the sound cues of irregular bumping of tyres over cat’s eyes on one side of the car, and the screeching noise of the other side of the car grinding along the side of the oncoming traffic or stationary vehicles or building, a crude form of progress can be managed; even if getting onto and off the motorway is problemmatic. Every year, there are stories of blind drivers in remote rural areas (usually with a child or drunk giving instructions from the passenger seat) being chased and halted by astounded traffic police. It clearly can be done, and is being done, more or less: but does it make sense? And is it acceptable?

Not being in control of your own innovation leadership behaviour as a leader, is like leading your team or organization as though it is a car that you choose to drive with your eyes closed. Most people have no idea what their innovation leadership profile is. They are in effect, blind leaders of innovation. We are probably all familiar with the idea that it is not what leaders say, but how leaders actually behave that has the most impact on organisations, and that it is their behaviour that sends the strongest messages and provides the most powerful cues as to what defines successful performance in the organisation.

The key to successful leadership of innovation begins with understanding

• The 4 Innovation Leadership Behaviours (ILB),
• The limitations of where you are now (in terms of your actual ILB profile)
• The nature of the challenge (in terms of your preferred ILB profile), and
• Being hungry enough to want to change, to take control, to do something about it.

For some leaders, the idea of developing an understanding of their own ILB profiles (actual and preferred) can be intimidating, much as primitive tribes were afraid that photography would steal their souls, or that to study and seek to understand the behavioural patterns might destroy the power of a secret formula by exposing it. But as they say at the Royal Air Force’s Parachute Training School: “Knowledge Dispels Fear”. And this knowledge is essential, and if you have it then it becomes possible to ask yourself:

1.What will it take to move out of efficiency strategies into effectiveness strategies?
2. What can I contribute to making this organisation more successful?
3. What kind of innovation leadership should I be working on?
4. How can I develop myself to make a difference, and become more effective?
 
The 4 Innovation Leadership Behaviours (ILBs)
For innovation to occur in an organization, you need a mix of at least 4 generic types of Innovating Leadership Behaviours – Creators, Translators, Stabilisors and Navigators. When planned for, encouraged and balanced correctly they can promote and deliver continuous innovation.

They are:

Creators - Who provide the source of new, disruptive ideas.
Translators - Who connect new ideas to new opportunities.
Stabilisors - Who build quality delivery systems for products and services.
Navigators - Who anticipate what’s coming, know when to get in, when to get out, and how to manage it.

The 4 Innovating Leadership Behaviours are extreme stereotypes and usually (but not always) I find that leaders’ profiles have proportions of all four in their own characteristic “portfolio” depending on the limitations of their experience, work environment and their natural work preferences.

Conclusion
Understanding the implications of leaders' ILB patterns is a powerful source of information on the limitations of the existing strategy and what is going to be required to move out of efficiency and survival into effectiveness and growth, in difficult times.

Chunking, or The Leader's Rule of 3

This innovation leadership tool is about rapidly identifying the vital few issues and obstacles that need to be managed or dealt with, and allocating attention and resources to them.

The “Rule of 3” is an idea I engineered from studying leadership, change and innovation. It’s the product of combining Pareto’s Principle, Williams’ close observation of Field Marshall Montgomery’s characteristic approach to getting things done and Max Atkinson’s research on successful speech-making.

Pareto’s Principle suggests that 80% of the effects observed in a situation are caused by a mere 20% of the population. His original 1906 observation was that 80% of the wealth in Switzerland was held by only 20% of the population. This has become a quality method for identifying the most powerful variables in a situation which need to be controlled to manage failure.

Field-Marshall Montgomery: Brigadier Williams serving as Montgomery’s Intelligence Chief [i] noticed his preference for 3-part lists as a means of simplifying complex issues and concentrating resources. In Hamilton's biography of Montgomery[ii] , he notes that in the last year of WW2 Monty was constantly trying to stop the Americans attacking across a broad front to incur 100,000 casualties instead of concentrating at a few points, feinting at one and then making the main effort at another. As Monty said in a letter after the command performance scandal of the Battle of Bulge: "We have failed to date by trying to do too many things and not giving enough resources to any of them to ensure success..."

Max Atkinson[iii] points out the power of leaders simplifying big issues through 3-part focused lists in his analysis of powerful political speeches, particularly their “air of unity or completeness”. It is as though we are programmed to listen more deeply to a 3-part list when we know it is coming, and that audience interruptions tend to occur after 3 points have been stated within a longer list.

Chunking as a Technique (or Identifying and Working on the Vital Few)
This technique is designed to gain a rapid understanding of the vital few issues that need to be managed to be successful. It requires use of the Creative Silence technique to brainstorm all the problems and obstacles involved in delivering the goal.

The goal or the aim must be clearly stated. The team must have had time to immerse themselves in the data involved in the situation.

In preparation a flipchart sheet needs to be prepared with the word “Start” at the top and “Finish” at the bottom, everyone must have pink post-its (for brainstorming issues or obstacles to delivering the goal) and black medium pens to write with. You invite the group to silently brainstorm the issues or obstacles that need to be managed to deliver success. They share these, 3 at a time. You apply CGSM (Common, Ground, Special, Missing) and concentrate the groupings to simplify the themes down to at least 3, with a hidden willingness if necessary to reduce to 2 or expand to 4 or 5, depending on the nature of the challenge. These pink issues or obstacles post-its are then put in an approximate sequence to the left of the vertical arrow connecting “Start” and “Finish”.

Having broken down the issues or obstacles to the vital few (possibly the top 3), then break your team into 3 parts, and allocate 10 minutes for the 3 sub-teams to work concurrently on developing solutions for overcoming the top 3 issues, writing their solutions onto blue post-its and positioning these to the right of the vertical arrow, parallel to issue or obstacle they deal with.

Invite the sub-teams to share these and for the others to add value to their prototype solutions. Identify or vote on the optimal solutions. Use the 3-part list of obstacles and matched solutions in your communication strategy.

[i] Howarth, T.E.B (1985) Monty At Close Quarters, Leo Cooper/ Secker & Warburg: London/ New York, p22.
[ii] Hamilton, N. (1987) Monty: The Field-Marshall, Vol.3; Hodder & Stoughton, p254.
[iii] Atkinson, M. (1984) Our Masters’ Voices: The Language and Body Language of Politics, pp57-72.

Innovation, Passion, Sex, Leadership and Rock'n Roll

Peter Cook's recent book: "Sex, Leadership and Rock'n Roll" is a commentary on the importance of combining two key elements of leading innovation (of leading people to do new things and leading them to learn to do old things in a new way), of learning to connect with the stuff of passion (ie. sex and rock and roll) in order to innovate. Obviously business isn't rock'n roll, but there are compatible elements that usefully explain successful, innovating organisations.

Rock'n roll, like business is old and yet it is eternally new whenever a new practitioner comes along with some passion (and a willingness to mine the gold of sexual imagery, or at least romance) who can successfully manipulate a few variables and change the context. David Bowie managed it by taking William Burrough's consciously random cut'n paste manipulation of printed text and visual fashion imagery, with a willingness to adopt an ambiguous sexual persona. And the rest is history, and millions made.

Peter makes some key observations that leaders need to take on board, that discipline and creativity need each other, but that if you don't have ingredient "X" you won't get invited back to the next gig, that if you don't have the passion that lifts others and the ability to "play" in the moment, the passion that helps others to be great in turn, you cannot lead: you can only preside.

As Ken Olsen said: "Leaders do the right thing, managers do things right". And it takes passion to do the right thing because you are probably going to be seen as behaving unreasonably by people who have no sense of the importance of doing something different, now: before it is too late.

Q&A with Peter Cook: Sex, Leadership and Rock'n Roll: http://dontcompromise.askeurope.com/2009/09/03/humdynger/

Innovation Processes are Useful, but Innovative People are Essential

There is an assumption in many organisations that focusing on innovation processes is a kind of industrialisation of innovation, that with the right processes, then you don’t need to worry about employing genuinely innovative people, anyone can and will be successful within a great process.

And it’s true, up to a point: especially when the focus is upon optimising existing products and services. But when the environment changes radically, then the issue of having the right people to innovate becomes important.

I have noticed that innovation consultancies tend to focus upon time-intensive innovation process consultation with a few useful techniques thrown in. This is because whilst they help to focus attention on developing a shared understanding of an agreed approach to turning an invention into an innovation, and on the need to understand customers’ needs, such consulting enables at least 5 additional benefits:

• Consultancies can sell high-priced consulting time, acquire practice and gain another case study to use with new clients,
• The illusion of purposeful activity without having to question the customer’s existing strategic assumptions, political hierarchies, and investment rationales,
• Gives confidence to an employing customer with academic mindset that measures good intentions by the size of investment,
• Enables leadership to sponsor the solution to a problem that appears to be solveable, rather than forcing leadership to work on the real problem that they prefer not to discuss,
• Reinforces the myth of leadership knowing what it is doing.

Whilst I disagree with the attractive book-selling post-rationalist approach of Jim Collins in “Good To Great” (2001) and Tom Peters & Rob Waterman in “In Search of Excellence” in retrofitting plausible success models onto case studies which subsequently decayed a few months or years later in public, both hint at the importance of getting the right people involved in changing an organisation. As Collins puts it, leaders must understand: “the importance of getting the right people on the bus (and the wrong people off the bus, and (only) then (figuring) out where to drive it.” More revealingly, on the same page, Collins observes that “a company should limit its growth based on its ability to attract enough of the right people”.

But what and who are the right people, how do I recognise them; and what do I do about myself?