Monday, January 5, 2009

Leading Innovation - How Google Does It

Elephantj0234280jpg The customer looked up from the computer screen, "Dave, this software module is fantastic. How did Siemens come up with it?"

"I worked with one of our recently hired programmers, Ray. He's part of our new, innovative engineering team. They focus on bringing products to market fast."

"OK Dave, I'll buy from you this time. But only because you're telling me that Siemens is becoming more innovative and responsive to customers. I still think they're like a giant elephant that has not learned to dance. But I'll give you and them a try."

Ray left the following year. The new team collapsed. The top salespeople (including me) left within two years. Siemen's U.S. west coast market share plunged from 50% to 15% faster than you could say "abandon ship." The elephant had not learned to dance (i.e., innovate) because Siemens didn’t know how to consistently tap into the innovative talent of their employees. Do you tap into yours?

Let's look to Google, the second most innovative company in the world according to BusinessWeek, to help you unleash the creative energy of your people. (1) Here are six strategies that researchers from Babson College discovered help elephants like Google dance (2):

1. Budget innovation into the job description. Managers are required to spend approximately 30% of their time on innovation. They are held accountable for this time in their frequent reviews.

2. Eliminate friction at every turn. Google's approach to innovation is akin to jazz, very improvisational. Any engineer in the company at any level can create a new product or a new feature to an existing product. One engineer tells the story of his first month on the job. He complained to a coworker about the Google e-mail system. His coworker told him to fix it himself. After doing so, his code was reviewed the following day by the e-mail engineers. A week later, his changes were incorporated into the software.

3. Let the market choose. Google has no grand design regarding how new offerings fit together. They let the market do that. They do not worry about identifying the perfect product mix. Google perceives their 132 million users as evaluators of new products.

4. Cultivate a taste for failure and chaos. Nature teaches us that experimentation is king of the jungle. Google plants a thousand flowers and analyzes which ones bloom. Executives are unfettered by failure. In fact, they perceive failure is merely corrective’s feedback. Google CEO Eric Schmidt encourages this experimental mindset when he says, "Please fail very quickly -- so that you can try again."

5. Create a collaborative work environment. Google packs offices close together for better communication, conducts all hands meetings every Friday, and maintains a rigorous interviewing and hiring process.

6. Use feedback to stay on track. Employees are scored on 25 performance metrics. Google systematically models the attributes of their highest performing employees, while continually modifying their hiring approach based on ongoing analysis of performance.

The 2008 Innovation Survey by BusinessWeek reported that Siemens is now ranked 38th in innovation among global companies (1). I'm happy to hear my former employer has taught their elephant to dance. Which of these strategies could be adapted to fit your team? How surprised will you be when your elephant starts performing the Nutcracker Suite?

See you in the ballroom,



2. Bala Iyer and Thomas Davenport; Reverse Engineering Google's Innovation Machine, "Harvard Business Review", April 2008, 59 - 68.


Sue said...

Hi Dave,

Great to see that you created this Leadership blog. It is eXcellent! I really found the "Leading Innovation" article informative and inspiring. What I also really like is that the articles are packed with insightful info/tips while being brief. An informative yet very easy read. Congratulations!

Dave Jensen, Leadership Expert said...

Hi Sue,

Thanks for your comments. Hope you can use the ideas to help your biz.


Eshan said...

I really enjoyed to reading your post with all points which you share about leadership. Thanks for sharing with us!!!