Oops! Innovation often disappears during a retrenchment phase

Eliminate organization fat; don't cut into muscle

A recent conversation with Aiden Lawrence in HP highlighted the following: When organizations are going through a ‘crisis period’, innovation falls to the bottom of the in-tray. Perhaps not overly surprising, but it’s often overlooked in the mix and can have profound medium-term consequences. Here’s what actually happens.

Steady Phase: Best-practice organizations going through a ‘steady phase’, ensure that innovation is solidly on the agenda. A range of continuous improvement (CI) and organization development (OD) techniques can be deployed to ensure that forward movement is hardwired into the company. The best-managed companies embed these practices into the way they operate. Innovation becomes the norm, part of the fabric of the organization rather than a ‘bolt-on’ activity. Innovation is best understood as a process that needs infrastructural support to make it work; it’s seldom the ‘eureka’ breakthrough moment we see in cartoon bubbles. However, during times of retrenchment when the focus is on cutting back, ‘good stuff’ sometimes gets thrown overboard, Organizations that are under the cosh, have little appetite for anything ‘zany’ which does not immediately contribute to the bottom line. And, that’s when you can make some really big mistakes, the equivalent of cutting off your right leg as part of a weight control programme.

Women’s Tights: Some years ago I facilitated a meeting in Vermont, USA. The idea under discussion was whether woman’s tights could be sold to men, increasing the potential world market for these products by 100%. First time out, the point seemed almost laughable. I actually thought that there might be a hidden camera in the room and we would be starring on some American reality TV show. As the discussion evolved, it moved onto the effect that heat has on muscle performance. When the idea emerged to target elite sports people e.g. ‘high testosterone’ males to promote the product, this ‘silly’ idea stated to become much more believable. Now it’s possible to go into any sports shop and see several brands (Under Armour, Canterbury etc.) of similar products. A product idea that initially seemed crazy has become a mainstream, hugely profitable business.

Expanded Team: All organizations have people who are ‘paid to’ innovate. Process engineers in the Pharmaceutical industry, engineers in manufacturing and managers in financial services are all tasked with ‘making the place work better’. The raison d’être for these people is to improve the flow of work. But when times are tough, non-essential roles come under the microscope. The danger here is that a lot of ‘invisible productivity’ can be lost to a business when these roles are chopped off at the knees.

Employee Engagement: There is a second point at play here. Arguably it’s possible to categorize staff in most organizations into ‘3 groups’. For ease of communication we could label these groups as actively engaged (extra milers), disengaged (saboteurs) and a more neutral group (freewheelers). Obviously organizations want to stack the deck with as many engaged people as possible and minimize the other groups. Makes sense. But you don’t know where you are on this continuum unless you have some way to measure this. This is not water-cooler tittle tattle (“I don’t think the climate is great at the moment”); it’s the science of measuring employee motivation and connection with the organization. If you really believe something is important, you measure it. You wouldn’t drive a car without a petrol gauge or fly a plane without an altimeter. In similar vein, you shouldn’t run an organization without measuring this critical variable. The best managed organizations, like HP, do exactly that. They understand how innovation works. And they measure how well employees are connected with the organization. In troubled times, these tasks can seem like organization ‘fat’ which should be removed. It’s an all too common mistake.

The Lesson: This one is simple. Those of us who spend most of our time in the ‘change business’ and all managers within their own organization should follow the rules of surgery. Be careful that you only remove non-essential tissue. In the race towards becoming a high performance organization, it’s easily forgotten that the pendulum can swing too far to the right. There’s lean; and there’s anorexic. The real trick is to understand the difference.

Paul Mooney

PS Enjoy the Golf Masters. If you like golf, this clip is worth a quick look. link…http://www.youtube.com/watch?v=Qcu9zKARTU0&feature=youtube_gdata_player

PPS Recently returned from a cruise on an Italian ship, so some of these quips are timely…. When the captain of the ill fated Costa Concordia was asked if he knew where he was going he replied “off course”. He will soon be in the dock – which is more than can be said for the ship. It was in line with the way they served drinks e.g. on the rocks. At least we now know the fastest way to get off an Italian cruise ship i.e. follow the Conga Line (the Captain and the Moldovian dancers will be at the front).

Look out for the next blog….on Sunday, April 18th. Happy Easter!

Know someone who’d benefit from reading this blog? Forward it on or ask them to contact paul@tandemconsulting.ie and we’ll add them to the mailing list.


About Tandem Consulting

Paul Mooney holds a Ph.D. and a Post-Graduate Diploma in Industrial Sociology from Trinity College, along with a National Diploma in Industrial Relations (NCI). He has a post-Graduate Diploma and a Masters in Coaching from UCD. Paul, a Fellow of the Chartered Institute of Personnel and Development, is widely recognised as an expert on organisation and individual change. He began his working life as a butcher in Dublin before moving into production management. He subsequently held a number of human resource positions in Ireland and Asia - with General Electric and Sterling Drug. Between 2007 and 2010, Paul held the position of President, National College of Ireland. Paul is currently Managing Partner of Tandem Consulting, a team of senior OD and change specialists. He has run consulting assignments in 20+ countries and is the author of 12 books. Areas of expertise include: • Organisational Development/Change & conflict resolution • Leadership Development/Executive Coaching • Human Resource Management/employee engagement
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2 Responses to Oops! Innovation often disappears during a retrenchment phase

  1. Hello! I realize this is kind of off-topic however I needed to ask. Does operating a well-established website like yours require a massive amount work? I am completely new to blogging but I do write in my diary every day. I’d like to start a blog so I will be able to share my experience and feelings online. Please let me know if you have any kind of suggestions or tips for new aspiring blog owners. Appreciate it!

    • Hi Olga. Getting the blog set up took a bit of ‘techie expertise’ – but not too much (I had someone help me with this). After that, it takes me about 3-4 hours a week to write up the blog. The ‘first draft’ might be done in a hour or so, but there is usually a bit of re-writing and then finding a suitable graphic etc. Hope this is helpful. Don’t let it put you off. This stuff gets a bit addictive. Regards, Paul

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