I define radical innovation as a serendipitous result of many self-organizing, interdependent employees learning from profuse experiments to produce 10x improvements. This kind of innovation involves a cultural shift and accompanying changes in HR and leadership practices. The increasing complexity of today’s business world makes the old industrial era model obsolete. Leaders now must up their game to successfully navigate this business environment, which calls for adaptability (versus efficiency), speed (versus perfect execution), networked (versus siloed) team structure and pattern recognition (versus technical depth), with the primary management goal of accelerating learning.
These are some of the steps organizations must take to survive in today’s increasingly more complex business environment:
1. Radical Innovation Is Serendipitous.
Radical innovation is an accidental result of many employees practicing self-organization, learning from lots of trial-and-error experiments. It cannot be planned. An important aspect of a leader’s job is to create a culture and environment where innovation can happen, where people feel psychologically safe and deeply connected. In his book “Team of Teams,” this is what General Stanley McChrystal attributes to how the Navy Seals instantly and instinctively sensed what each other was thinking and acted as one organism on a mission to rescue Captain Phillips.
2. Radical Innovation Requires Self-Organization.
Gone are the days of command and control. The speed with which this new, fast-changing environment is producing new information has exceeded the speed at which traditional bureaucratic hierarchy can send information up and down its chain of command. As a result, there has been a decoupling of information, power and responsibility. Information resides with frontline employees, but power and responsibility reside with top managers. Hence, employees cannot take action in a timely fashion, which creates inefficiency and ineffective decision-making, a deadly situation in this fast-changing, complex world. Decisions must be pushed down to the edges of the organization so that all employees have a voice in the decision-making process.
3. Radical Innovation Is a Result of Profuse Fearless Experimentation and Learning.
It simply does not come about in an atmosphere where people don’t feel safe or connected. On the foundation of safety and connection, leaders need to allow employees to correct errors when they read signals from the environment and adapt accordingly (this is how I define learning). Allowing employees to experiment and fail powers good decisions and is a sufficient and necessary condition for radical innovation.
4. Radical Innovation Germinates For a Long Time.
Radical innovation surfaces at the critical inflection point when momentum has become large enough (as some would say, “self-organized criticality”). It happens when many self-organizing employees experiment profusely and learn – to see how best to adapt to the environment and to adjust their behavior iteratively using simple rules. The iterative adaptation, based on the results of these experimentation, builds the momentum, often well below the radar, which has a long germination time. The employees take cues from the environment in an open feedback system. Radical innovation is a result of employees co-evolving with their business environment in an open, transparent system where information for feedback and adaptation flows without friction.
5. Radical Innovation Builds on Good Enough Solutions.
In the process of this constant adaptation to signals from the environment, employees use simple rules (i.e., “If A, then do B”) to speed reaction time, rather than executing with perfect accuracy, because permanent change happens as a result of growth of variances or errors from imperfect execution. As such, speed to generate meaningful variances from iterations of trials is more important for radical innovation than perfection.
6. Once Manifested, Radical Innovation Sustains For a Relatively Long Period.
Once manifested, radical innovation sustains for a relatively long period until the next radical innovation redefines industry dynamics, starting the process all over again.
In this rapidly changing, complex business environment, innovation is the only way to survive, and rapid learning is the best way to produce innovation. A cultural shift for organizations to facilitate is the new management mandate, which calls for deep team connection and the psychological safety necessary to experiment (and fail). Deep team connection is essential because connection and secure attachment increases resilience, which is required in the face of profuse experiments and inevitable failures.