Innovative business

Innovation and good HR: you can’t have one without the other

Human resource professionals are becoming strategic role-players in promoting innovative approaches at companies
Innovation and good HR

Human resource professionals are becoming strategic role-players in promoting innovative approaches at companies. Reinvention and creative thinking in terms of novel services, new markets and organisational functioning have become crucial in modern-day business. No longer seen as merely administrative, HR departments are increasingly taking on strategic roles in the business world.

Innovation is a broad-ranging term that includes not only the generation of creative ideas, but bringing them to fruition and executing them. Different organisations approach innovation differently. Many mass market organisations believe that they should ask customers and respond to their needs. Here innovation is driven by market research to tailor products and services to customer or client needs.  

Apple – arguably the most innovative company in modern times – as well as one of the most profitable – places a heavy emphasis on the creative product being the result of collaborative team effort. 

“Customers don’t know what they want until we’ve shown them,” Steve Jobs was once quoted saying, invoking Henry Ford’s famous line: “If I’d asked customers what they wanted, they would have told me, ‘A faster horse!’”.   

The problem is that collaboration is diametrically opposed to competition, which is the lifeblood of our economic order so many companies are afraid to go there. But those that focus exclusively on competition will find that there are unintended consequences such as fear of taking risks and challenging the status quo, lack of trust, being territorial and blocking information. These have the effect of reducing the amount of knowledge flowing back to the organisation from customers or clients.

So in order for innovation to flourish, people involved in modern organisations and in particular leaders must be able to manage seeming opposites; competition and collaboration – innovation and efficiency. It is a skill that must be honed. At the heart of the matter is an ability to tolerate ambiguity and uncertainty, which are competencies of emotional rather than intellectual intelligence.

This is where the HR function comes into play: helping to create the kind of team that will generate completely novel ideas. The more diverse the team is in terms of gender, age, education, skill, function, personality, culture, race, thinking style etc., the better. Co-operating with people who are unlike ourselves requires emotional intelligence; an appreciation of others’ talents; an ability to engage in meaningful conversation and to manage conflict constructively.

Many researchers maintain that executive behaviour is the single most important lever in the creation of company culture. The senior team’s mindset and basic assumptions direct the practices, decisions and allocation of resources in an organisation and their behaviour is the reference point for others. If they are seen to be supportive of each other and work as a team, others will follow suit. An organisation’s leadership development strategy must recognise its part in the role as culture creators in recruitment, promotion, succession planning and development initiatives. HR has a meaningful and strategic role to play here as well.

Although senior leadership behaviour dominates, culture is an outcome of interrelated practices, processes, routines and habits that enable and reinforce it. Cultural change can be affected through processes in the HR value chain throughout the organisation. Recruitment and promotion play an important role and in this context it means placing a great deal of emphasis on emotional intelligence capacities and the ability to build and value relationships. It’s a tall order to include even more competencies into job profiles in an environment where there is a shortage of skilled people, but one that will pay off in the long run. 

Other practices that promote collaboration include regular social activities as well as performance management and reward strategies being aligned around collaborative effort rather than exclusively emphasising individual performance and competition.  

Tampering with the company culture is not to be done lightly. After all, if the current culture is highly competitive, it will likely have attracted talented people who thrive on competition. That will be the hallmark of success for its leaders. In attempting to switch horses to a collaborative culture, one may find that it is not nearly as attractive to some of the mission-critical people in the organisation. 

The trick is to marry competition and collaboration. Changing practices has to be done in a conscious manner with the full implications of the changes laid out. This is the strategic role of the HR department. It must be able to articulate the assumptions that underpin, the implications that are likely to follow, and the potential unintended consequences of changes. Research shows this is how companies get to the top – and stay on top. 

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