In our last two posts, we focused on the change that is required by large organizations when they are embarking on an innovation journey. We separated the invention from the innovation, and talked about a framework to help direct the strategy of innovation.

By far the most popular paragraph from the last post was:

If you want to build an innovation mindset in your organization, it’s not about whiteboards and hoodies, it’s about providing every one of your employees, as well as your customers, and partners, the opportunity to make things better, of finding new ways to do the things you currently do. This empowerment is the first step to creating an innovation mindset.

Empowerment is a great way to inspire those important stakeholders to get started on the problems that need to be solved to make things better. But how do you sustain this momentum? What happens when those first few attempts either don’t work out in the way that someone expected or take longer to develop the way the customer wanted?  Well, momentum dies because we look only to the results as the indicator of success. The team failed because the outcome wasn’t what someone expected. What if the behaviour was right? What if the team did all the right things, but the customer still said no. What if the customer was wrong?

For those involved in innovation activities in big companies, and to truly create an innovation mindset in the organization, your reward and recognition strategy needs to start, and end, at the behaviour, not the result. In existing businesses or product lines, there are few variables to influence the outcome, so rewarding the outcome makes more sense. But for those that are trying to create new things, or experiment with processes or technologies that make existing business better, they must be recognized for the attempt. Celebrate that they tried, learned a few things, and shared those lessons across the organization.

Scott Bedbury, in an earlier podcast, talked about his time at Nike. Bedbury said that former Nike CEO Phil Knight would rarely punish mistakes, but if someone hid those mistakes and tried to cover them up, then it was time to look for a new job.

So, inspirational talks, new office digs, or big problems to solve are all necessary to build an innovation mindset, but they are not sufficient.  Your employees are motivated by money and recognition, and that is completely normal. Let’s reward the things that we love to see in innovation roles: calculated risks, customer-centric thinking, and a drive to ask “how” to do something, instead of “if” we can do it.

Compensation is often not part of the innovation mandate, but if you want internal innovation to be successful and sustainable, let’s pay people for behaviours instead of just the outcome that is created.

Lessons learned

  1. For sustainable innovation, you must move beyond empowering people to solve big problems, you must reward them for mindset to tackle those problems.
  2. On the other side of the table, don’t punish mistakes. Encourage people to share the lessons from those mistakes.
  3. Find those people who like to ask how to do something, instead of if it can be done.
  4. Get compensation professionals involved in innovation and ask them what kind of recognition programs inspire creativity and innovation.

Photo: Prizes, by Ariel Dovas, is licensed under CC BY-NC 2.0

About The Author

Craig Haney
Director, Corporate Innovation, Communitech

Craig is leading the charge for corporate innovation in Canada. His work with Canadian Tire Innovations helped launch the LeanLab project at Communitech, helping large, non-tech companies become faster and more innovative by engaging with startups. As Director of Corporate Innovation at Communitech, his focus is to grow the ecosystem by exposing small companies to big problems they can solve for some of Canada’s largest players. Craig has an undergraduate degree from the University of Western Ontario and a Masters of Business, Entrepreneurship, and Technonogy (MBET) from the University of Waterloo.