24th Annual AmCham Human Resources Conference –
The Innovation Imperative: Igniting Advantage Through People and Culture
Keynote Addresses: Innovation Comes From Everyone
By Nan-Hie In
Business owners, human resources practitioners and other professionals gathered at AmCham’s 2015 Human Resources Conference to absorb insights from cutting-edge business experts, scholars and human resources leaders on the best practices and traits of the most forward-thinking companies worldwide. Innovation from a human resources perspective was the key focus this year.
Allen Ma, CEO of Hong Kong Science and Technology Parks Corporation, began the day with his opening speech discussing the importance of innovation as well as his model for innovation.
In the age of disruption, particularly those driven by technology, no organization is immune to transformation, and ill-prepared companies risk obsolescence. Others adapt and thrive by capitalizing on shifts in this new business environment. Companies must “innovate or die,” Ma says.
According to The Conference Board CEO Challenge 2015 survey where leaders in various economies identified their most critical challenges, innovation ranked seventh amongst those in Hong Kong. “That is very worrying; if you are one of those CEOs, you will be in trouble soon,” Ma cautions, calling on leaders to make innovation a higher priority.
He highlights a four-pronged framework – recruit, engage, accelerate and procure – to enhance innovation in companies.
Recruit, engage, accelerate & procure
Ma advises companies to harness innovative ideas from talent within and outside the company. Great talent is a key differentiator between companies at the forefront of disruption and non-innovative firms under siege from disruption. It underscores the importance and impact of human capital on business performance.
A benefit of recruiting talent for ideas in-house, or ‘intraprenuership,’ is that those ideas can reach the market quickly, thanks mostly to an existing internal infrastructure. In contrast, start-up entrepreneurs often have to seek external help and financing to roll out their product, which can take time and become a dreadfully long process.
The origin of Sony’s popular PlayStation video game console, Ma cites, is a fine example of successful ‘intraprenuership.’ It is a story about a young Sony engineer playing Nintendo video games with his daughter and realizing the prospects for the Japanese firm. While most executives brushed off his idea at the time, one was receptive, and the rest is history.
“The key was that one of the executives listened to this young guy’s idea,” Ma says, noting four golden rules in empowering staff to embrace entrepreneurship.
Firstly, finding ideas internally and rewarding creativity help companies ‘crowd-source’ ideas from all talent available in their organization; secondly, setting an innovation culture by making top management more accessible and paying attention to young staff breeds entrepreneurship.
Thirdly, rewarding failure is an essential part of the learning curve. “Failures are finger posts on the road to achievement; with every failure an organization is one step closer to success,” Ma explains, adding that errors offer valuable insights about what to do and what not to do while saving time and resources in future endeavors.
Lastly, companies should consider IBM’s ethos that “even elephants can dance.” Employees of large corporations often bemoan that innovation is stifled at giant institutions – a belief Ma refutes because there are many stories about successful corporate turnarounds, including IBM in the 1990s led by CEO Lou Gerstner.
“It’s about leadership and how the leader can rally support from the management team; it’s also about having an approach and strategy that is clearly communicated down to the working level, which makes a difference,” he says.
By the same token, if companies cannot source innovative ideas from talent in-house, they need to recruit and engage outsiders instead, Ma says, highlighting competitions hosted by various companies in the US for which anyone offering the best solution to a problem are financially rewarded.
A recent example is when General Electric launched a 3D printing challenge in 2013 for a redesign of a metal jet engine bracket that would reduce the weight by 30 percent. A solution concocted by Indonesian engineer M Arie Kurniawan was picked as the winner for a prize of US$7,000 in the competition which drew nearly 700 entrees from 56 countries.
The growing numbers of start-ups can also be a source of innovation: a number of companies in Hong Kong offer start-up accelerator programs such as Swire Group’s Blue Print Program and Accenture’s FinTech Innovation Lab to help small businesses grow and to discover new talent in the arena.
Corporations can often benefit by investing in early stage start-ups. “[Startups] come with creative ideas you have never thought about,” Ma says, adding that such knowledge sharing can lead to a new solution or insight. When no innovation merges despite repeated attempts, companies could consider buying solutions.
Elaborating on leadership behavior and their impact on innovation in the closing keynote address, Dr Alison Eyring, CEO of Organization Solutions, emphasized the role of human resources practitioners in driving business growth and innovation across industry sectors.
Eyring says human resource practitioners can do so by engaging in communications with leaders, outlining five “super practices” leaders can exercise regularly to enhance business performance, and these are based on three decades of extensive studies on what drives individuals, teams and organizations.
Firstly, leaders can drive innovation by helping staff understand what they need. “Be very clear on what innovation means to the business, why it matters, and ensure it is expected from employees,” Eyring says.
And they need to talk about it regularly with everyone across the organization. “I encourage those on the leadership team to think about how much time on the agenda is spent on discussing innovation,” she adds.
A shared vision with a visible commitment needs to be created to achieve a goal as a team. “Every leader within an organization, whether it’s a first-line supervisor or someone running a global business, has opportunities to pull together a team to solve extraordinary problems,” she says.
An example is that of a cosmetic surgeon in the US who had the vision for a ground-breaking facial reconstruction surgery, Eyring cites. By recruiting a team of over 100 surgeons and spending much time on preparation, the doctor pulled together a team and successfully operated a facial transplant for a victim whose face was burned beyond recognition in a fire.
“These people had never done this surgery and they worked overtime in practicing on cadavers,” she points out. “So, where are the safe places to practice so that your team can rehearse and be ready?”
Thirdly, Eyring suggests that companies bring outsiders in – from customers to competitors – as they can yield invaluable insights. Many tech firms such as Microsoft, for example, have design centers or dedicated areas for customers to try out prototypes deriving from the latest technology, while a team of staff observe and obtain feedbacks from interaction of customers with the product.
Another “super practice” is an obsession with excellence, Eyring says, recalling her experience with Ferrari a few years ago when she observed drivers and their teams engaged in constant monitoring of the performance, measuring the temperature of the engine and the number of tires burned using the latest computer technology.
“After the race, they studied the data to think of ways to improve [performance],” she says, signifying the need to understand what drives your business performances and encouraging HR professionals to do the same by thinking how they can create visibility to what matters and whether they should employ metrics to drive excellence.
Lastly, a great work environment which makes your employees intrinsically motivated and their jobs interesting is conducive to nurturing ideas. Among the characteristics, autonomy and challenges on the job are the most important factors having an impact on innovation. This is especially evident in the services industry.
“Being able to give staff autonomy to make decisions is important for creating a great experience – it also allows innovation at the point of interaction with the customer,” Eyring explains, noting how a housekeeper took the initiative to delight guests at a Disneyland resort by putting stuffed animals bought there in a special arrangement in their rooms.
Business leaders are encouraged to empower staff with decision-making responsibilities as it helps employees grow and produce great work; and HR practitioners are encouraged to work with business leaders to engage in these “super practices. Although leaders often claim they do, employees sometimes have a different view.
“One thing HR needs to do is help employees have a bigger voice – and we have to help leaders hear,” Eyring says.