You’re a large company with unique challenges. You’re operating internationally, across a large portfolio of products and teams that have grown and changed over time, and tackling a huge range of challenges. No less, you’re doing it all in the middle of a pandemic! 

This is why it’s more important than ever to nurture a strong innovation culture. A good underlying innovation culture helps to overcome these sorts of challenges, and we’ll show you how.

Innovation culture doesn’t just mean coming up with new shiny ideas. It doesn’t mean ignoring the important work in progress or all the context in which the business operates. 

An innovation culture means using the collective knowledge of your team to crack problems in novel ways. And these can be any sort of problems – product problems, process problems, organizational or team topology problems. You name it. 

Because you’re not defining the solutions to the problems. You’re creating the sort of environment where problems get solved.
Innovation culture is powerful. Just ask the likes of Facebook or Autodesk or others who foster cultures of innovation, and leap ahead of their competition…. and take home the profits because of it. Companies with a strong innovation culture massively outperform others of similar size on just about every measure of success, from revenue to growth to market share. 

via Suzie Prince – @pm_suzie

The graph above shows how Google, Netflix, and Amazon are massively outperforming on the S&P index. This is because, in these sorts of companies, their innovation culture has helped them adopt a way of working that reduces risk and the chance of failure, and increases their chances of landing on successful initiatives. 

When we talk about innovation culture, we don’t mean just in terms of product management. Innovation should be thought of holistically, and inclusively, not just in the domain of people who wear the product management or R&D hat. 

Everyone in the company has a role to play. 

A huge part of the value of a good innovation culture comes from how it enables different groups to work together towards the same goals, rather than against each other. This is why I call it a team sport.

Let’s get there!

So what sets these sorts of companies apart, and how do we get there? 

1. Acknowledge it will be tough

First, let’s acknowledge that it’ll be tough.

New ways of working are never comfortable for everyone involved. It ends up plowing through people’s perceptions. It breaks their existing processes that they’d just gotten tied down neatly. It laughs in the face of some of the metrics used to measure some parts of the business.

Depending on where you’re coming from, it can require a whole mindset shift. It can be like taking away a comfort blanket, and put people at unease. It can also end up putting more tangible things on the line, like bonuses, commissions, or even jobs, depending on what’s being changed and to what degree. 

You’re a product person. This is where your empathy skills come into play. Where you find that there’s resistance to new ways of doing things, get out and ask those Five Why’s – figure out why people are really resistant to change, and where possible, make adjustments to create a better balance. 

2. Get executive buy-in

This is a team sport, but if you’re not going to be allowed to use the playing field or any of the equipment, your team isn’t going to get far. 

You need to get at least some degree of executive buy-in.

Innovation can come from within and build upwards, but it too often gets trampled out if it’s not welcomed as the way of working.

Sometimes, what I’m writing here shouldn’t be an entire surprise to your company and its execs. This isn’t new stuff that’s untested and untrustworthy. Lots of organizations have forged the path ahead successfully and have shared their results along the way. But this buy-in is key. 

Your skills as product people come into play here – you’ll need to manage expectations upwards, communicate what’s needed and why, and articulate the benefits of this innovation culture to any execs who need clueing in. 

3. Use the whole team

And as I said earlier – innovation culture is holistic. Make use of the wider team.

As you might have heard from Marty Cagan – if you’re only using your developers for code, you’re wasting half their talent. The same is true for the rest of your team too. 

Remember, as Product people, it’s not your job to have all the answers. It’s your job to ask the best questions. To surround yourself with the experts of all different stripes around you in your team and make use of their knowledge. They’re no good to you if innovation is kept behind closed doors, however unintentional.

4. Break down silos with transparency! 

If you’ve got silos, break them down with a dose of transparency. 

It’s really common to hear about the mistrust that other teams have of their product management division. Examples of this can come in the form of sayings like “It’s where ideas go to die.” or “No one knows why product decisions are made.” We understand where it comes from, but it’s entirely preventable.

The product development process can be a mind-boggling one. 

After all, even consider the sense of time to someone in product versus someone in support or sales. 

If someone suggests an idea, it probably goes through Product. Let’s say 6 weeks later, that same person asks for an update. 

To the product person, 6 weeks is nothing. That’s a few sprints, perhaps a handful of things were actually done, but chances are, that specific idea wasn’t one of the things delivered. 

To the salesperson, 6 weeks is a long time. That can make or break a deal. And it’s made worse when they can’t see what was done instead. 

See, the product team isn’t ignoring these ideas or saying no out of spite. 

It’s just that there are always going to be way more ideas than can ever be built, and so, realistically, unless the idea is stellar and solves an immediate problem, it’s not going to be prioritized over everything else. 

In the past, the art of product management was always a bit of a secret process. Ideas would go in, and the product team would make decisions, and the finished product would come out. 

This leads to people in the rest of the team thinking that product management is a black hole. 

Or that product managers aren’t really doing much back there. It demoralizes and tends to end up with people not bothering to suggest their ideas anymore because they don’t trust they’ll see anything from it. 

It results in an innovation drain. 

All that will change with a good innovation culture. 

Good innovation culture should help to demystify the product management process. 

5. Make space for innovation!

You should create a space where team members can see what’s going on with their ideas and suggestions, and how it relates to the bigger picture. 

This creates accountability where there is otherwise a black hole. Anyone can see where their idea ended up, and whether it’s tied to objectives that have been prioritized at the business level, or whether it’s going to have to sit it out to let other ideas shine. 

You’re looking to create transparency in decision-making. That way, it’s not the product manager saying no. It’s the product management system, doing its thing – prioritizing the right problems to solve, and making it clear to everyone which ideas will solve those problems and which won’t. Ego and bias are removed from the equation. 

You’re just left with better product decisions and everyone with a clearer understanding of why.

Innovation culture is less wasteful.

Some might be thinking that this whole innovation thing is going to cost a lot of money and maybe come up with very little benefit. 

But done right, a strong innovation culture means fostering a culture that avoids unnecessary wastage. 

In a traditional organisation with siloed divisions, every division is measured as either a profit center or a cost center. 

Innovation is a Team Sport

Management’s goal is to squeeze just a little more revenue out of sales and marketing, and to push down costs in areas like support, tech and operations.

Research & Development is a cost center

Do you know where product and innovation sits? We’re usually seen as a cost center. 

We’ve historically reported into a tech function whose job it was to keep a close eye on costs. Which gets the product and development team trapped in this old pattern of writing finely detailed specs, breaking them into points, and being measured on ‘velocity’, or how quickly the team can ‘burn down’ that stack of points.

This model might control costs, but it optimises for building features, not for solving problems.

And there’s nothing as wasteful as spending your time building the wrong things! 

These old vanity metrics lead companies to be misled about their productivity. After all, the engineering team is constantly busy, but are they working on the right stuff? 

It’s why you can have two companies in the same space, and one is much larger, and theoretically much more capable of delivering more value, and yet lags behind a smaller, nimbler competitor. 

Innovative teams are more productive

I’ve seen companies who put immense effort into getting their engineering teams absolutely swimming, churning out all sorts of stuff. And yet these teams still don’t produce much value. 

They put out mediocre launch after mediocre launch.

This is because, as good as their engineering team might be on the delivery side, their product processes leave something to be desired. They’re often still stuck in an IT project mindset, rather than embracing an innovation culture.

A strong innovation culture makes sure that the right things are built in the first place.

Innovation is a Team Sport

Lots of effort has already gone into smoothing out the delivery side of the business. But your innovation work sits upstream from that, in the strategy and discovery spaces. 

A sign of a strong innovation culture is that company level goals are always in mind, and that the problem space is deeply explored before diving into the solution space. This ensures that the work that actually goes to delivery actually is of value, and that lots of different viable options have been explored, and the team knows they’re likely heading down one of the best paths, not just the first one they stumbled upon. 

Iterating Innovation

These aren’t things that happen overnight, a strong innovation culture evolves.

It’s something you can measure, and learn from, and build upon, through training and tools and team retrospectives. Much like when you Build, Measure, and Learn on your own products every day. 

Whether your team and processes are particularly innovative or not is something you could measure as a baseline. I’ve given you some ways you might frame those measurements in this blog.  

Over time, you could make adjustments to the way people work (through training and tools and some of the techniques discussed here), to facilitate and build a stronger culture of innovation.

And as such, I’d say that innovation culture is the most important product you’ll ever work on.

And it’s something that you work on as a team.

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