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What is innovation about? Everyone has a perspective on innovation and all of them are legitimate since innovation is a bit of a gray area. Our perspectives form over time, the long term. In my case, recent history impacted my perspective quite a bit as a result of learning more about innovation in general, how it is applied in different industries, and what it means for an organization like HMSA.

Our innovation challenge is to enable all employees to learn about, participate in, and contribute to innovation. Are we there yet? Heck no. Are we working in it? Yep. Will it work? Maybe. At a minimum, we will learn as we sincerely try and we will adjust along the way.

What are some of things we need to focus on to meet this challenge? One way to simply answer this question is to describe what we think innovation is about. As I share my simplified perspective below, I do realize that, to many readers, this list could be shorter…and…it could be longer, but this is what I distilled it to at this point in time.

Innovation is about: 

• Deeply thinking
• Time to think and experiment
• Space to think and experiment
• Self-directed participation
• Diverse perspectives
• Less bureaucracy
• Less administration
• Less process control
• An organization that listens and responds to you
• Limited funding early
• Experimenting early
• Evaluating early
• Failing early
• Risk and failure tolerance
• Strategic value to HMSA
• Value to the community we serve

 As an example, when I state, “Less process control,” does that mean across the board? No, process control has its place and benefit. What I am referring to is less process control during innovation activities, which could be from the onset of a problem to be solved all the way through scale-up and launch.

What’s your perspective? I’d definitely like to know. The more diverse perspectives, the better.

Ah, yes, “innovation culture” is another topic that is widely discussed in innovation blogs, articles and seminars. There is no shortage of opinions. I don‘t mind the buzz around this topic since organizational culture has a significant impact on our ability to effectively infuse innovation. It’s up to us to absorb opinions and facts about organizational culture then form our own opinion and approach. 

What is organizational culture? To begin answering this question, let’s address what it is not. Organizational culture is not what is printed on corporate flyers and spoken by leaders. It’s not the poster on the wall that states what our values and principles are. Rather, organizational culture is defined by the prevalent behavior and actions we practice within our organization. Organizational culture is influenced by underlying assumptions – traditional, automatic rules we follow based on what we understand to be acceptable and unacceptable. 

How does organizational culture impact infusing innovation throughout an organization? The more risk averse, process oriented and bureaucratic an organization is, the more time it will take to effectively infuse innovation. In extreme cases, innovation will never be effectively implemented. 

Whirlpool’s organizational culture in 1999 is similar to HMSA’s today. I am referencing Whirlpool since they are a good case study we can relate with…and since they successfully infused innovation throughout their organization. What are HMSA’s similarities? We are predominantly risk averse, process oriented and bureaucratic. This is common among large organizations. HMSA is by no means alone. 

As I have stated in earlier blogs, and as other consultants and authors have stated, production operations are the heartbeat of a successful business. There is an absolute need and value associated with excellent risk management, process management, and quality management. The problem is when these management systems do not incorporate and balance innovation – the implementation of valuable, strategic creativity. 

Doing an excellent job of what we do today is good but without infusing the level of innovation we desire, we risk our future. We risk the future of the community we serve. We risk fulfilling our mission of providing access to quality care at a reasonable cost. We risk achieving our vision to build a sustainable health care system in Hawaii. 

We all recognize the need for innovation. We all desire it. What prevents us from actually doing it to the level we desire and need? Organizational culture is a significant part of the cause. 

There are a variety of cultural barriers to innovation. Here are barriers Whirlpool identified over a 3-year period of surveying their workforce via multiple methods. Regardless of the method, the answers remained the same. 

• Almost anyone above or beside an employee will say no to an idea. It is too hard to buck everyone’s opinions and experience, and many employees give up after trying a few times.
• The company is overly process oriented and internally focused.
• The company is risk averse.
• There is a lack of incentive to be innovative. Goal-setting, performance management, and compensation systems do not support, recognize or reward innovation.
• There is no structure or forum for innovation. People with an innovative idea don’t know who to take it to or what to do with it.

Here are a couple common descriptions of the environment that came through the surveys: “Lots of creative people and ideas but an environment that does not nurture this” and “Ready, aim, aim, aim, aim.” 

Whirlpool’s conclusion: As an organization, they do not support innovation. They favor analysis over action. People feel frozen. They have no follow through when people present innovative ideas. 

Can you relate to these barriers? The main difference among most large organizations is the degree to which these barriers exist. 

Within our organization the current, popular barrier is “How can we find time to innovate when our plate of work is already overflowing?” At the management level in Whirlpool, this too was a popular barrier. Here’s an introductory discussion by Whirlpool about how they approached this barrier. Be assured, there is much more to addressing this barrier than mentioned below. 

Leaders have ongoing accountability to run the business. We realized, however, that if we did not make long-term innovation as much of a priority as short-term results, we would find ourselves in a never-ending catch-22. The revolving dilemma of innovation embedment is that leaders must protect innovation from the day-to-day, month-to-month, and quarter-to-quarter business. 

We did not have a hard-and-fast formula for our leaders to follow. But we asked them to take stock during their review of daily, weekly and monthly activities, and in our longer-term work planning sessions, of two important questions: 

1. Am I doing enough to balance the short-term and mid-term with the long-term?
2. Are we using the pressures of the present as an excuse not to do the hard work of innovation embedment?

This represents only the beginning of Whirlpool’s approach. There will be more discussion in future blog posts about leadership development and accountability needed to overcome this and other barriers. 

I am concluding this blog post by leaving you with two organizational culture self-assessment tools via Strategic Innovation and Unleashing Innovation. Try ‘em out. A hūi ho!

Related posts:

• Developing the HMSA Innovation Experience
• Define Innovation
• Vision
• Infusion

In a previous blog post titled Developing the HMSA Innovation Experience, I mentioned we are immersing ourselves in two core books while surrounding them with other sources that add value along the way. One of the other sources is the book Unleashing Innovation – How Whirlpool Transformed an Industry.

The authors of Unleashing Innovation describe their view of infusing innovation throughout their organization. We’re interested. Here’s some of what they have to say:

What makes Whirlpool unique is that it has chosen a path that shuns the popular notion that innovation can come only from the geniuses at the top. Whirlpool “innovated innovation” by putting systems and processes in place that enable every person at every level, including entry-level professionals, clerks, secretaries and hourly employees, to innovate.

We realize that the relevant questions are How did you change a ninety-plus year-old culture? How many incremental and game-changing innovations have come out of the approach? And perhaps most important: How have you made your innovation sustainable?

Whereas other companies approach innovation by trying to foster more creativity, generate ideas or screen ideas as though these were specific techniques, at Whirlpool we sought to infuse innovation into the very fabric of the organization. Innovation is not “added on” at Whirlpool, but embedded. Embedded innovation is the approach that Whirlpool pioneered to create innovation as a core competency. What makes embedded innovation unique is that it builds a capability that is sustainable beyond any one person, team or leader.

Innovations can be incremental or breakthrough, but it is the ongoing ability to innovate and create value that distinguishes embedded innovation from other approaches. Embedding innovation in processes and procedures – creating the innovation machine – is only half the battle. Innovation is truly embedded only when it lives in the hearts and minds of people.

To understand how innovation works, you need to look at the structures and processes, and at what really makes innovation come to life in the people who actually do the innovating. You must look at the rational processes and procedures of innovation, but also uncover the deeper, less quantifiable emotional drivers that unleash the spirit of innovation in people.

The rational drivers include a business framework (resources, processes, systems, incentives, and more) that makes embedded innovation sustainable and often requires reengineering of legacy management systems.

The emotional drivers, in contrast, are not created by a company, but are resident in each of us as latent human factors that attract us to create and innovate. Management’s task is to ensure that these emotional drivers are unleashed rather than thwarted.

Although many other approaches to innovation use some of the rational drivers, it is the combination of the system of rational drivers and the emotional drivers that makes innovation “from everyone and everywhere” an exciting reality at Whirlpool.

So, how do we do this? Hang on. It’s all part of the journey.

Related posts:

Developing the HMSA Innovation Experience

Define Innovation

Vision

As the authors of Strategic Innovation state, “We found that the keystone to innovation embedment was, without doubt, a clear vision and set of goals.” They continue to discuss the importance of having an enterprise vision and an innovation vision aligned with one another. Subsequent innovation goals, measures and strategies can then be developed under the guidance of these visions.

To create our draft innovation vision, we considered: a) HMSA’s enterprise vision; b) many discussions we’ve had about what we are trying to achieve via innovation; c) other innovation visions from organizations anywhere on the globe; d) if available, reasons why these organizations worded their visions the way they did.

HMSA’s draft innovation vision is:

Innovation by everyone today for a sustainable tomorrow

Why did we select this for our first draft?

It aligns with our enterprise vision to help build a sustainable health care system in Hawaii.

It aligns with our draft innovation principles we adopted from Strategic Innovation. These principles represent current values, beliefs and focus in-line with our innovation journey:

• Innovation must be possible from anyone
• Innovation must permeate to the fabric of our culture and business
• Innovation must be sustainable

It is succinct, simple to remember and provides high-level direction and guidance for details to follow, such as goals, measures, strategies and so-on. It represents the beginning of a necessary, new experience. I believe it will be a positive experience. Onward!

Related posts:

Developing the HMSA Innovation Experience

Define Innovation

Continuing from my previous blog post about developing the HMSA innovation experience, one of the first areas of common ground among authors and various discussions is defining what innovation means to our organization. Elaine Dundon, author of Seeds of Innovation, kicks it off this way: 

Unfortunately, the concept of innovation has been so widely used and misused that many people are now confused as to what it really is. 

A good starting point is to develop a common understanding and definition of what the term innovation means to you and the members of your team and organization. Take time to discuss and agree upon your own definition. 

Innovation is much more than finding and connecting creative ideas. It is about strategy and action – bringing value to the organization through the implementation of creative and strategic ideas. 

A simple, common definition of innovation based on four key components is: 

Innovation is the profitable implementation of strategic creativity 

This goes beyond simply referring to the act of creativity or the identification of new ideas. 

The definition above is based on applied research, interviews with executives and managers, as well as practical experience working with many international companies and other organizations. 

Contrary to popular belief, HMSA does not wish to make a profit…or a loss. Rather, we forecast the pricing of our products to break-even while maintaining a reserve fund to cover unexpected losses and pay for medical expenses of patients in our health plans when these losses occur. So, Elaine’s use of the word “profit” in her definition of innovation needs to be modified to better represent our intentions with innovation. To twist this up a bit from an innovation perspective, should we limit innovation to a non-profit model? The simple answer is no. There might be compelling reasons to establish self-sustaining, for-profit, new businesses that bring significant value to our community. That being said, here’s our draft tagline definition of innovation for HMSA: 

Innovation is the implementation of valuable, strategic creativity 

Creativity: The discovery of a new idea. 

Strategy: Determining whether it is a useful idea; determining how the idea helps achieve our strategies and mission. 

Implementation: Putting a new and useful idea into action. 

Value: Maximizing added value from the implementation of a new and useful idea.

It is important to have a single-phrase, easy-to-remember, meaningful tagline definition of innovation that represents our intentions. There’s a ton of detailed discussion about innovation behind the tagline. But first we need to establish a high-level, simple definition that guides us as we continue down this path. 

This is also known as “Developing Innovation Culture and Value”. Not because “innovation” is the latest abused buzzword in businesses and governments everywhere today. Rather, because we firmly believe innovation is absolutely necessary to fulfill our mission of providing access to quality care at a reasonable cost. Our mission is more challenged today than ever before; hence, our need for an aggressive campaign of sustained innovation throughout HMSA, involving everyone, every day. Exciting times are ahead. Much easier said than done.

Yes, it sounds like a utopian, far-fetched goal to have everyone innovating every day but it’s a goal that sets the bar high to gain as much traction as we can possibly achieve.

How will we shift from a culture with pockets of innovation to a culture with innovation as an essential ingredient of everyone’s daily behaviors and actions? As I write this blog post, the HMSA Innovation Center is drafting an approach to seed the conversation. No doubt, what we draft will change as we engage others in this conversation. Every project we’ve embarked on started with a seed-concept that matured and morphed by the time it was ready for implementation. This challenge is no different.

Where are we with this effort? We are at the very beginning but we aren’t starting cold. Fortunately many folks in HMSA have been deeply involved with innovation in past and recent history. And they have been surrounded by people outside HMSA who have been influential from an innovation perspective.

Over the years we have absorbed a variety of innovation tips, techniques, models and perspectives via books, social media, conversations and more. As a result, we are currently immersing ourselves in two core books while surrounding them with other sources that add value along the way. If your goal is to embed innovation throughout your organization, I recommend reading and applying these two books to start the learning and seed-concept process:

The Seeds of Innovation by Elaine Dundon

Strategic Innovation – Embedding Innovation as a Core Competency in Your Organization by Nancy Snyder and Deborah Duarte

There is common ground among innovation authors and consultants as it relates to organization-wide, culture-based innovation. I’ll be blogging more frequently to share this common ground, what we are learning, and what we are drafting.

A hūi ho!