How HR Leaders Can Create An Innovative Culture
Culture is more than a buzz word. And whether you plan for it or not, your company has one. Which raises a number of questions…Can you describe it? Do your employees know what it is? Do they embrace it and reflect it? If your answer to these questions is no, or worse yet, I have no idea, then it might be time to ask how HR leaders can create an innovative culture.
We know that companies that invest in building an intentional organizational culture outperform other companies. We also know that today’s tech driven business landscape requires us to be more innovative than we have in the past. Today’s competitors are not just your shortlist of known companies. They might be in other industries or just started in someone’s proverbial garage. Regardless, the combination of creating an innovative culture can reap rewards for the bottom line and employee engagement.
Gartner has conducted a lot of research into this topic and found a broad, network-based approach to cultivating innovation achieves the best results. According to Brian Kropp, group vice president of Gartner’s HR practice, “Individual or team-based innovation strategies improve innovative effectiveness only marginally as they typically involve too few actively engaged employees or there’s a lack of momentum for innovative ideas from leadership.”
To build a culture of network-based innovation, Gartner identified three main strategies:
- Involve employees beyond the idea-generation stage. Giving employees more visibility into and ownership of which ideas to pursue ensures more employees are actively engaged in innovation at their company.
- Shift leadership mindset to shared, not individual, risk-taking. HR should help functional leaders collaborate to gain a deeper understanding of how to take better digitally motivated risks and chances.
- Supply employees with more guidance, not more access, on using networks to innovate. HR leaders can gain traction and maintain momentum by considering how ideas move through their organization and equipping employees with a new outlook of who to work with — beyond the formal structure — and how to push ideas forward.
Mr. Kropp added, “CEOs are looking to the HR function to drive digital transformation efforts and increase innovation across the organization. The organizations that get it right and are able to improve their innovative effectiveness can increase annual revenue by as much as $8,800 per employee.”
Building an innovative culture encompasses two areas, bringing in necessary digital talent that embraces the culture, and developing new habits, practices, and mindsets with existing employees. According to Gartner, to improve culture, there are three conversations CEOs must have with HR leaders.
Conversation 1: Define culture as a set of tensions, not attributes, by identifying points of tension in the culture and helping employees navigate them. Organizations taking this approach improved workforce-culture alignment by 16%.
Questions the CEO should ask HR:
- What are the tensions that exist in our culture?
- Which tensions are vital to our culture? How do we know?
- How do we help employees navigate those strategic tensions?
Conversation 2: Listen to employees’ unfiltered feedback to uncover the true culture by asking leaders not to interpret feedback, but to create space for employees to share it. Organizations taking this approach saw 11% more confidence in culture understanding.
Questions the CEO should ask HR:
- What tools do we have today to understand the culture?
- How do we involve employees more in assessing and communicating the culture?
- What do I need to change to encourage more feedback?
Conversation 3: Embed culture leadership into business leadership by holding leaders accountable for remodeling business processes to reflect the culture. Organizations taking this approach improved workplace-culture alignment by 18%.
Questions the CEO should ask HR:
- How do our leaders think about their role in driving organizational culture?
- How can we raise the stakes on culture leadership at our organization?
If you’re still not sure that HR can lead this conversation with the executive team, Gartner notes that after analyzing earnings calls over the past decade, culture is easily the top HR issue, with mentions of it growing at 12% per year. Even still, less than one-third of HR leaders believe their company has the right culture to drive future business performance.
Culture is ingrained in people, and making changes takes time. The workplace is forever changing right now. The impact of technology, digital natives, global competition means you have to define your current state and develop a plan to get to your future state.
Start with awareness, openly talking about challenges, desired outcomes, and current perceptions. Then be transparent, early and often. Keeping a consistent two-way conversation throughout the process involves the employees and increases the chance of buy-in. People are more likely to embrace change when their voice is heard and they are part of the process. A second benefit of including everyone is the impact of diversity on the outcome. When you listen to everyone, a diversity of thinking emerges that an executive team alone may miss.
If you have questions on how you can create an innovative culture, send us a note, and one of our executive recruiters will respond. We work with hundreds of companies and can help you create an innovative culture.