Innovation. Is it just for those creative types? Can you, the business owner, simply delegate out innovation?
The answer, of course, is no. Not just because you are the business leader; but because innovation is the job of everyone in your company. Looked at this way, the critical role for every business owner is
Setting up a structured environment that will bring out the best in people, a place where they can create good habits and truly flourish.
Let’s look at an example.
In 1987, Paul O’Neill was named the CEO of Alcoa. In his introduction to the Wall Street crowd, Paul got in front of the microphone and started talking about focusing on worker safety. 45 minutes talking about worker safety. Wall Street was not impressed. In fact, for the first few months, neither were his senior officers and managers. How would worker safety improve Alcoa?
Paul’s first step was to require all unit presidents to report to him within 24 hours any worker safety violations. At the time, Alcoa didn’t have the communication systems to respond effectively in 24 hours. Innovation 1 was off to the races. And quickly accomplished – a better communication system.
At a completely different level, the union was still not embracing productivity. Worker safety? How could they not embrace that? One key safety issue they identified was molten metal splashing on workers, injuring them.
Innovation 2: A brand new pouring system was developed. Not only did this innovation improve worker safety, it resulted in less wasted material. And greater productivity and profitability. More innovations began and accelerated.
Rallying around a singular issue – worker safety – Alcoa quickly hit record profits. By 2000, someone who had invested in Alcoa when O’Neill began there would have had all of his money returned in dividends while his stock would be worth five times as much.
So, what was really at work here? Paul O’Neill created what is called a keystone habit. According to Charles Duhigg in his book, The Power of Habit, a keystone habit is one which all other good habits are spawned from.
Just by focusing on worker safety, everyone at Alcoa started to change, innovate, and do the things necessary to make sure worker safety was number one. It spawned all of these other great habits and got this organization moving forward faster. A very practical way of getting innovation to take place.
When you look at your business and you’re trying to put something in place, think of what your company’s keystone habit would be. What greater cause can your company rally around? What universal process or value can everyone grasp? Envision how it could impact different areas in your company and spur new idea generation in all aspects of your business.
Here at Coyle Financial Counsel our keystone habit is CRM (client relationship management). For us, it’s not a software package, it’s who we are. Everyone at Coyle embraces it, turns it into their critical habit and incorporates it into every aspect of our business. Without this keystone habit in place, we would not be able to efficiently deliver the high-touch, personalized service that our clients have come to expect.
Innovation starts at the top but you don’t have to be some creative type coming up with wild ideas for all areas of your business. Define your keystone habit and watch your company’s innovation bloom. In some ways, I suppose you have delegated out innovation. You’ve said: “Here’s our simple cause. Now go and innovate.”
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