17/5/2561 The Secret to Organizational Innovation – The Startup – Medium

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Matthew E. May Follow
Humble strategist helping organizationsprintand
again.
individuals change, grow, and win. Passion for
ideation, facilitation, and the written word. https://matthewemay.com
Dec 3, 2017 · 5 min read

The Secret to Organizational Innovation

In my previous article (Why Innovation Remains Elusive), I identi ed a

half dozen obstacles to companywide innovation. I also hinted at a
grand uni ed solution in the form of a strategic innovation system.
Allow me ease into it by way of story and analogy.

Most people are familiar with the name Toyota. Most business people
are familiar with (or at least not completely ignorant of) the vaunted
Toyota Production System (TPS), a much-studied manufacturing
approach. Having served as a fully retained advisor to Toyota for over 8
years, I have particular point of view on that system, and, more
importantly, why it matters when it comes to a discussion of
innovation.

As former Raychem CEO Paul Cook once wrote, “To be an innovative

organization, you have to ask for innovation. You assemble a group of
talented people who are eager to do new things and put them in an
environment where innovation is expected. It’s that simple. And that
hard.”

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This was my very challenge at Toyota. At the time, the production

environment was implementing over 700,000 ideas a year. The non-
manufacturing side of the business wasn’t anywhere close to that.
Many had tried porting over TPS principles to knowledge work, but had
failed because knowledge work is far closer to art than science, even
though we like to pretend it isn’t.

I was looking for a toehold, a handrail, anything that would give me

some traction. Trying to break things down into component parts…
tools, techniques, processes, DID NOT WORK. In the midst of it all I had
one of those slap to the forehead moments…not quite a Eureka
moment or epiphany but more of a if-it-was-a-snake-it-would-have-bit-
me” sort of things. In other words, it was staring me in the face: “It’s the
system, stupid.”

If you were to ask a manufacturing executive in the 1950s what kept

him up at night, you’d hear a whole host of woes related to quality, cost,
and speed: overload, inconsistency, and waste in the form defects,
bottlenecks, inventory issues, retooling, line delays, supplier issues, you
name it.

It’s easy enough to develop processes and tools and techniques to

address one or two of these issue, but collectively? it requires a set of
integrated processes, tools and techniques to achieve what I call an
elegant solution, which is one that achieves the maximum e ect with
minimum means.

The elegant solution was the Toyota Production System, de ned as “a

repeatable system of work designed to produce the highest quality,
lowest cost, and shortest lead time.”

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Put a pin in that for moment.

I recently asked over 100 CEOs what their greatest challenges, issues,
and pain points were when it came to innovation in their organization,
irrespective of how they de ned innovation. The responses produced
the same sort of gauntlet as the one faced by 1950s manufacturing
executives. It just had di erent issues: lack of capability, resourcing,
risk, getting started, incrementalism, creativity, fear of failure,
executive buy-in, focus, return on investment, alignment, con dence,
bureaucracy.

Like production issues, you could easily pick o a single challenge and
meet it, but collectively? A elegant solution — a system — is required.

Introducing the Strategic Innovation System (SIS), de ned as “a

repeatable system of work designed to consistently guide creative
concepts from inception to tangible commercial product in alignment
with company strategic goals.”

And just as the Toyota Production System under the guidance of a

master can be e ectively installed in a manufacturing setting, so can
the Strategic Innovation System under the guidance of a master be
installed in a more corporate setting (as well as a manufacturing one).

Conceptually — in full awareness that all models are wrong but some
are useful — the SIS can be thought of as three major gears, constantly
moving and feeding both forward and back. Visually it looks like this:

The rst gear, Governance, is about clarity, commitment and

alignment. The second gear, Generation, all about directed creativity

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and conceptualizing. The third gear, Go-to-Market all about value

delivery and commercializing. One without the others will obviously
give lift, but will be insu cient to neutralize the laundry list of issues
above…innovation will thus remain elusive.

The real value of the SIS is embedding an ethos of experimentation, the

bene t of which is the ability to rapidly learn: because if we know
anything, it’s that learning and innovation go hand in hand, but
learning comes rst.

I’ve pressure-tested this system in the wild with a few select client
companies. What makes it work is to think about it just as you would
enterprise software: a robust set of eld-tested, integrated tools and
methods — each of the tri-part gears plays host to a powerful but user
friendly toolkit — with complete installation and training to help
manage the change, supported by an innovation center of excellence.

Now, some may say that the secret to organizational innovation is

“culture.” I wouldn’t argue that at all. It’s just that it is “the system” that
lies at the root and gives rise to “culture.” You cannot change a culture
without changing the underlying system. The system bats last. It’s what
Paul Cook was hinting at.

I aspire to make this system available to anyone interested in

transforming their company into a constantly innovating one. One
thought is to provide the “system in a box,” with extended guidance
and support — live and virtual — and a continuously improving toolkit,
on a subscription basis.

If this is of interest to you, please let me know so that I might keep you
informed of progress toward public availability.

matthew.may@me.com

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