Disruptive innovation and change management
Often, when I am asked the question of why our firm, Inward Strategic Consulting got into this business I usually provide an explanation that falls into five different categories. 1) Change is hard to embrace, 2) brand purpose and value are unifying, 3) Employee advocacy is paramount, 4) Sales channel understanding is a necessity, and 5) Internal/External brand alignment is critical.
Over the next few weeks, I plan to explore each of these five topics with more in-depth analysis, obstacles, and recommendations to improve performance and achieve internal alignment, change, and purpose-driven branding.
For this blog post, let’s focus on CHANGE and DISRUPTIVE INNOVATION and why internal purpose-driven branding is an integral part of an effective change management program.
CHANGE IS HARD TO EMBRACE – A STRONG INTERNAL BRAND IS ONE STEP CLOSER TO CHANGE ADOPTION BY EDUCATING AND ENROLLING STAFF TO EMBRACE AND ACCEPT THE NEED FOR DISRUPTIVE INNOVATION AND TECHNOLOGY AND COMPANY TRANSFORMATIONS
We are living in a disruptive innovative marketplace where if companies hope to survive, they will need to change just about everything that they do. They can no longer rely on their current business models; product portfolios, traditional customers or product uses. New and improved innovative competitors are popping up all over the place. Two weeks ago, at Consumer Electronics Show (CES) there were thousands of new disruptive technologies that were being showcased on belt buckles and wearables, to pharmaceutical and biotechnology to adaptive mobility and so forth. I heard from one client in the pharmaceutical sector that she was overwhelmed at the creativity and the threat of this disruptive phenomena on their traditional pharmaceutical businesses. Here are four companies that have successfully navigated innovative disruption and internal cultural change.
The old mantra “Change Or Die” is becoming a reality. This was true through the “Reengineering” and “Process Redesign” era of the 1990s. My colleague and friend, Dr. Michael Hammer, father of the reengineering movement, when he told me that 80% of the major change initiatives fail and that 50% of the reason why they fail has to do with peoples inability to embrace change or their negative attitudes toward adapting to change. He was the one to encourage me to launch a change management/communication practice to persuade people to understand the consequences of change and to appreciate the benefits individually and reap the rewards. We launched our firm 20 years ago at Arthur D. Little and never looked back.
“Disruptive Innovation” was coined in the early 1990s by Harvard Business School professor Clayton Christensen (who passed away last week), the term has become virtually ubiquitous from Wall Street to Silicon Valley. It has three distinctions. Disruptive Innovations are NOT breakthrough technologies that make good products better. Rather, they are Enabling Technology - An invention or innovation that makes a product more affordable and accessible to a wider population. Innovative Business Model - A business model that targets nonconsumers (new customers who previously did not buy products or services in a given market) or low-end consumers (the least profitable customers). And lastly, Coherent Value Network - A network in which suppliers, partners, distributors, and customers are each better off when the disruptive technology prospers.
Research from various outlets has shown that the principles of disruption can be beneficial to areas across society, including, technology, computing, healthcare, education, and economic growth.
It all comes down to a matter of relevance. How does a company change itself beyond its traditional markets, products, and audiences so that it becomes relevant and meaningful to their customers? Are your people engaged with the company’s strategy? It comes down to their brand purpose.
WHERE; WHAT; HOW & WHY
Vision is ‘Where’ of where you want to get to. This is a destination of what you want the brand or business to be in the future (e.g. ‘We want to be the world’s leading provider of X by 2020'). Mission(s) is the ‘What’ of you should do to get there: These could be specific initiatives or tactics centered around product development, operational excellence, go-to-market strategies or brand communications. Values are the ‘How’ you would like to behave to get there: What is the organizational culture of a company or an organization? And what are the qualities or behaviors it prizes: for instance, curiosity, inclusivity, diversity of thought, etc. The purpose is the ‘Why’ you exist: The higher-order reason for being for a brand or business than just ‘making a profit’ or ‘driving shareholder value’. Culture - A collective ethos of a group of people—the behaviors, beliefs, values, and symbols that they accept, generally without thinking about them, and that are passed along by communications, heritage, and imitation from one generation to the next. Culture is how a company operates together, at all levels.
If you want your company to embrace disruptive innovation and technologies and renew their purpose you need to start with a clear explanation of your internal brand. The change will not occur on its own. It requires a codified methodical process, no different from any other business process, to articulate steps and stages, roles and responsibilities, allocation of time and budgets and concerted aligned efforts across the enterprise. Management must allocate energy, focus, and commitment to changing the culture and its purpose in alignment with their internal stakeholders, channel partners and ultimately their customers.
It requires organized and coordinated tactical internal communications, critical message architecture/storytelling, training programs, internal social media efforts and incentive and recognition programs that sequentially move employees to being aware of the brand purpose, to understanding it personally, to become advocates through peer to peer recognition and finally to be incentivized and rewarded for exhibiting the right behavior in support of the brand promise. We call it INTERNAL DIALOGUE MARKETING AND COMMUNICATIONS. It is a step-by-step process that educates, motivates, inspires and enrolls employees to embrace innovation, disruption, and change. (We would be happy to share examples of our model)
All too often establishing an internal brand effort is an afterthought by senior leadership teams and simply taken for granted. This is a huge mistake. The senior leadership team should devote the same time, energy and money to internal brand communications as they do to external public relations and advertising campaigns. It should be professionally prepared and executed through sequential planning, programming, professional project management status reporting, and improvement.
Companies that maintain the status quo will fail. Companies must constantly be looking for creative innovation in everything that they do. From manufacturing techniques, expanding target audiences, creating new fresh business processes and products and hiring smart creative staff.
Adapting and embracing change is not an easy task. It’s like doing a lobotomy on your company’s brand purpose and culture. It requires expertise and skillsets that are often not available internally. It is best to hire an outside expert like Inward to help navigate the message, the story, tactics project planning and implementation. That is what we do. We’re a one-stop consultant shop that strives to find common ground for internal and, external brand alignment and, employee engagement. We help you find effective ways through sequential integrated tactical programs that engage your employees and get their buy-in, so you can transform your culture to provide better customer experiences.
Give us a call at 617-558-9770 or reach out – at asteinmetz@inwardconsulting.com.
Allan Steinmetz CEO