Corporate Eye

Tone At The Top Drives Innovation Governance

tone-from-the-topIn a previous post about tone at the top I discussed this subject… The post appeared when the economic crisis of 2008/2009 was about to start. Now tone at the top and innovation governance are more important than ever.

Simply put, ‘tone at the top’ is the sum of the Board’s and the C-Level manager’s values, actions and communications. How these responsibilities are executed will influence the success of the enterprise through the near future and will set the base for the longer term. These responsibilities include:

  • Strategy
  • Culture
  • Governance
  • Financial
  • Innovation

While most Boards and C-level managers know in at least some manner the importance of the first four responsibilities, too many are unaware of their responsibilities for innovation governance. As an HBR Network Blog indicates,

It’s time for leadership to step up. Match innovation rhetoric with personal involvement and investment. Move beyond narrow solutions to more systemic approaches. Raise aspirations from being the most innovative company among a tightly defined peer group to approaching innovation like Amazon, Pixar, 3M, or IBM. Actions that feel like luxuries today will be imperatives tomorrow, so get started.

Some companies heed this advice. For example here is a short sampling of what “the top” says about innovation governance:

Amy Radin, Chief Innovation officer at E*Trade Financial

Within this ever-changing landscape, strong leadership and a well-defined culture will determine a business’ success as a continuous innovator. But innovation has to be more than simply a groundbreaking idea – it has to be about viable new business concepts that meet real consumer needs better than what’s already in the marketplace.

Darlene Solomon, Agilent Senior VP and Chief Technology Officer

There’s a very strong innovation culture throughout the company, and a culture of teamwork. Agilent really encourages that. Innovation is not just R&D in Agilent. We’ve really tried to make clear that it’s about everybody questioning the status quo and looking to do something better than what’s been done before.

Fabrice Brégier, CEO Airbus

Innovation is at the heart of Airbus, it is part of our DNA and a fundamental ingredient in ensuring our long term growth and profitability. “This new network will instil and spread a more open innovation mindset across Airbus also taking on board the numerous ideas generated outside. I am convinced that this will enable us to respond to and anticipate future trends quicker for the overall benefit of our customers

While these exhibit a positive tone at the top, too many Boards and C-levels are risk averse and many lack a good or even a basic understanding of the technologies that drive innovation. More about this in a future post…

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Ed Konczal has an MBA from New York University's Stern School of Business (with distinction). He has spent the last 10 years as an executive consultant focusing on human resources, leadership, market research, and business planning. Ed has over 10 years of top-level experience from AT&T in the areas of new ventures and business planning. He is co-author of the book "Simple Stories for Leadership Insight," published by University Press of America.
 
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