Does Government have a leadership role in innovation?

July 13, 2009

Glenn Rothberg

Glenn Rothberg

Glenn Rothberg

An Australian Government initiative provides examples of idea leadership, but reveals aspects which remind LWD author Glenn Rothberg of the story of The Emperor’s New Clothes

A report of The Australian Government’s innovation policy agenda to 2020 was entitled Powering Ideas: An Innovation Agenda for the 21st century.

The initiative resulted from the change of Government in December 2007. Unfortunately, I believe that the claims are a little like the story of the Emperor’s new clothes. I list the various aspects of the report which have led me to that conclusion.

[1] Assessing Innovation Track Record

It is not at all clear that policy makers have accurately examined those gaps responsible for poor innovation performance in the past, in seeking to address performance in the future.

Powering Ideas says that Australia has a relatively weak innovation performance record, based on poor competitiveness, and spending on science and innovation. The policy statement does not articulate the source of these particular shortcomings, – just the result.

[2] Innovation Resource: Finite?

Secondly, I think there is a problem in defining the nature of the innovation resource. The Minister’s innovation statement says: “ Australia’s resources are finite…”, (p.4) . I argue that the ideas resource is not finite. For example, ideas accumulate, to become our store of knowledge, also making knowledge an innovation resource that is both renewable and expansive.

Of course, knowledge can also be depleted or rendered inaccessible, should ideas disappear. If the Government is assuming that our ideas resource is finite it may be limiting its views about innovation.

[3] Innovation: General or Selective?

Is innovation better understood as a national culture, or is it project-specific? Sometimes the report favours the one perspective while elsewhere it favours the other.

[4] Private, Public, Science and Non-Science Sectors

Typically, sectors and industries tend to be defined by their inputs, techniques of production, and value adding. This does not need to be the case. Ideas, knowledge, and innovation, like language, can cross all sectors. Innovation as a way of life should be reflected in activities spanning organizations, communities, regions. It should be evident in the private and public sectors, and other sectors, in which ever way they are defined, although the report seems to be confining the process to the business sector.

[5] Market Failure: How Do We Know?

The report references a lack of innovation arising because of market failure, but it is unclear that there is market failure. Ideas might also be lost because of the way in which organizations are managed. Perhaps their practices reflect flaws in management theory. In this case, the gap to be plugged is in understanding and re-framing what happens to ideas in organizations, and therefore throughout the economy.

[6] Innovation Framework

It is unclear whether the prevailing “capture” approach to innovation is adequately balanced by encouragement of the creative and implementation resources of stakeholders. It isn’t enough to state “we are all part of the innovation system …Genius is wasted if you can’t capture it and apply it to the real world. That’s what the national innovation system does”

[7] Measurement of Innovation

Little attention is paid in the report to what actually happens to ideas in organizations, and measuring this activity. It is not at all clear that prevailing measures of innovation are adequate, or that they are explaining relative growth performance in our nations. I have been looking at ways of framing and measuring idea activity and found, in a recent study, that one well-credentialed innovation index explains a negligible proportion of economic growth across 17 OECD countries over a 20 year period.

[8] Innovation Early Warning

A framework that acknowledges idea activity, frames it, and measures it, provides valuable information on what is happening while innovation is underway, or is being stalled. This is like an early warning system, preferable to the performance monitoring that tells you what has happened at the end of the innovation cycle. Perhaps there is still opportunity for a more advanced, early warning approach for the future.

[9] National Innovation: Priorities and Collaboration

In the process of encouraging innovation, the report is ambiguous in its support for being more productive and competitive, while also being collaborative. What is the basis of the suitability and superiority of the collaborative model of innovation? Why is it superior to the competitive model?

The Leaders We Deserve

I have outlined nine reasons why I believe that Australia’s new innovation policy has characteristics of the Emperor’s new clothes. Are we getting the policy leaders we deserve?

To Go More Deeply

An extended version of this analysis can be found on the Idea Activity website


Innovation leadership: a hard path to follow

December 11, 2008


Innovation leadership offers great rewards, but can be a hard path to follow, as the recent case of Project Red Stripe illustrates

Anyone who has become involved in the fascinating and infuriating business of innovation will find something of interest and value in Inside Project Red Stripe, Andrew Carey’s account of a much-trailed innovation project at The Economist newspaper.

The bald facts. The Economist called for and appointed a team of staff members to, well, to create the next big internet thing. The team was backed with £100,000 to do it. Oh, yes and it had to win GO/NO GO approval in six months.

The challenge captures the imagination. In my case, it took me back to other challenges, some recent, some in a pre-internet age. I’ll come back to these a little later.

The project shares the premise held by many organizations, that the next new winning idea is out there somewhere waiting to be discovered or (more mysteriously) to be created. The premise goes with a few other assumptions of what might help the process: find some creative and gifted people, offer them resources judged appropriate, add a dash of team training and development, and set them an energizing challenge.

As Carey puts it

To me it seems that this whale-of-an-idea was sometimes too much for the team. Too much for any team. They tried to bring it back down to size by playing with it: ‘Let’s divert the Thames through Lichfield’, ‘Let’s make the world square’. But still it became the elephant in the room, to mix gargantuan mammal metaphors. And the team found themselves becoming-whale-of-an-idea-in-the-room. Then they had two ideas. Which one should they choose? Had they chosen the right idea? Then the idea was altered. Was it still good enough? Then it was changed altogether. As time ran out there was an awful dread that they had missed their chance. And, from the moment that they decided to look externally for their idea, there was a pervading sense that the idea lived ‘out there’. Which meant, in turn, that the team would not be the authors or creators or owners of the idea.

The Culture of the group

The print version conveyed the culture of the group. For me, it describes a small group bubbling with energy, sometimes manic, with the kind of mood swings often to be found in team innovation projects.

At its inception, efforts were made to arrive at a diversity of experiences within the team. (Another bit of received wisdom for innovation teams). I wondered whether t ‘mission first, team afterwards’ missed a trick in team selection. If the prize is the ‘next big thing’, what might be the selection criteria? For discovery? For excellence? For delivery?

Carey describes the various dilemmas encountered as he struggled to make sense of the experience. Here’s one to add to his list, the Groucho Marx dilemma: how to assemble a team when the sort of person likely to think the unthinkable are often repelled by the ideas of teams. Might even the mighty Economist be too constraining a culture to retain in its ranks a Bill Gates, or a Richard Branson or an Anita Roddick? And how many such creatives might be good for a team? Before someone else mentions it, let me admit that the business tycoons who bothered with getting a business school education rarely shone on the formal courses, and often dropped out (like Bill Gates) to get on with the important business of inventing, designing, and making money. As for Business Schools, read Private professional elites
such as The Economist

Some lessons from history

Going back to my own extended involvement with various innovation groups, the Moby Dick reference triggered a flashback to a team of four set up within a great global organization. We have three strategic business streams. They are like three legs of an elephant. We want you to find the fourth leg of the elephant. The freedom did for us, more than the constraints.

Some years later I met the leader of another invention-seeking group from a company in a different industry. Again, it was a multi-national, again in search of the big new thing, which they believed could be best delivered a team whose only constraint was to stick to blue-sky thinking. The project manager had the self-confidence of the charismatic leader. He also seemed to be in a state of denial about the possibility that the company might just not have the knowhow to boss the world in a completely alien sort of business. It probably didn’t help that the group had acquired the name ‘the blue sky group’ (worse than red stripe, which doesn’t offer such an obvious hostage to fortune).

Both these efforts eventually sunk without trace. I have retained contacts with the organizations which have survived (no mean feat) but have no corporate memory of their innovation teams of earlier years.

These experiences seemed particularly depressing in contrast to the incredible claims made by Tom Peters and his ilk on innovative companies and their buccaneering leaders. Later the innovation frenzy subsided with more careful studies. Among these, of particular note are the analyses of Jim Collins, and the account by Ketchum and Trist of the benefits of autonomous groups at General Foods and elsewhere. These action researchers had re-discovered a systems perspective that went beyond the linear model of innovation having a ‘fuzzy front end’ where all the creativity rattles around, and the residual stages which make up the boring implementation bit. (Incidentally, the linear model highlights a similar fixation that has led Big Pharma into a misplaced search for the next block-buster drug) Ketchum and Trist re-discovered that organizational creativity is multi-leveled, that is to say a creative individual may not have a significant impact on a team, nor a creative team have impact on an organization.

So what happened to Project Red Stripe?
I think the team made a rather good fist of the challenge, and (they won’t thank me for saying it) at least were a class apart from the Alan Sugar playpen version of project leadership.

You may have guessed how the story is turning out, but you should make up your mind after accessing the website, which demonstrates the emergent and dynamic features of the new electronic media and particularly the social networking elements of it.

A courageous (foolhardy) venture? Maybe, but at least it will repay a visit to the website, which is morphing and hyperlinking its creative way into existence.