It always catches you by surprise when one of the leading players within the innovation space makes a change. In this case,Innosight has been acquired by Huron, a fellow professional services firm, one that has the vast majority of their business in the United States. Huron focuses specifically on Healthcare, Education, and Life Sciences and has been to-date far more operationally driven in its delivery solutions.
Being fairly curious you search for the fit and its meaning to both parties as Innosight has been continually shaping their offering to focus more on the strategic positioning of innovation over the past few years as the market has been undergoing a significant change in client demands and innovation solutions. I wanted to work through all of what this might mean and some more.
The transaction overview is ” Huron will purchase Innosight Holdings, LLC for $100 million upon closing, consisting of $90 million in cash and $10 million in Huron common stock, plus contingent consideration of up to $35 million if specific financial performance targets are met over a four-year period”
I would argue most problems or disappointment with our innovation efforts can be attributed to a lack of alignment to the organizations strategy and/or its poor governance with our end results. Here I am suggesting a way to overcome this constant frustration.
Poor strategic alignment can be overcome by working through a comprehensive approach to addressing all areas that impact innovation. One such framework I believe can help, as explained here, through the work mat approach.
I believe this work mat approach does moderate and organize innovation for greater alignment. It allows for the senior management to become engaged and shape the direction as it takes a more holistic approach. The work mat contains governance as specifically part of its framing as this can do far more in driving the conditions to innovate.
The intent with developing this work mat approach has been to clearly set out that much-needed ‘greater’ strategic connection through engagement at a senior level, they drive the outcomes, they provide understanding beyond the vision to make the neccesary connections, they fuel the engine and ignite the energy that innovation needs.
This week I tuned into the Pipeline virtual conference for product development practitioners and gained an encouraging feeling that innovation is progressing along nicely. Packed all within a day there was plenty of material ‘fodder’ to feed off of and learn from.
A really good conference but what quickly followed was a strong dose of that withering on the innovation vine.
I read two consulting surveys around innovation
I’ve been suddenly pulled out of my virtual bubble back into the harsh realities of where innovation really is. Just simply how innovation is struggling and that lies far more at the top of our organizations than below, those below who are simply trying to ‘get on with the job’ but with at least one hand (or even two) tied behind their backs.
I have been reading two sets of observations, one from Fahrenheit 212, the other from Innosight and my mood began to change. I’m suddenly back in reality where we have this huge gap between those ‘working’ innovation and those at the top simply not engaging with innovation or still failing to understand it or even failing to connect the dots.
Alignment of Innovation to Organization’s Strategic Goals
Working in most organizations you spend a disproportional amount of time on looking to achieve alignment. This can range from aligning your meeting schedules to the bigger strategic issues by gaining agreement on the way forward.
I would bet you that working on alignment is certainly one of the main tasks that is sucking up a large part of your working day. Interesting enough the higher up in the organization you go, the more you have to seek alignment. Gaining alignment is actually very hard.
In corporate life we are constantly attempting to also link organizational goals with our own personal goals. To make this alignment, it requires the difficult aspect of achieving common understanding of all the parties for the specific purpose you are requiring, so as to achieve a consistency between ‘agreed’ objectives and the implementation of these across those involved.
Julian Birkinshaw, the London Business School Professor for Strategy and Entrepreneurship wrote in his book “Reinvention Management” about the failure of management. He is a strong advocate of reinventing and broadening out the awareness and need for a more disciplined and up to date practice of management
Working through a kind of contingency theory of management
Julian points out different situations demand different kinds of management. To be effective, a manager needs to adapt to the demands of the situation. Managerial behaviour is mapped on four dimensions: bureaucracy-to-emergence, hierarchy-to-collective wisdom, alignment-to-obliquity, and extrinsic-to-intrinsic motivation.
The principles of emergence, collective wisdom, obliquity and intrinsic are newer ways of thinking about management. I must say I like these as I do his framework as a really good way to think about the approach we need to explore that fits with the strategy and the way we want to develop a business and its environment.
Innovation needs to exploit all the ‘opposing’ principles across the four dimensions
Strategy as we have previously known it is officially dead. Strategy is stuck! Competitive advantages have become transient. We are facing situations where advantages are copied quickly, technology is just one constant change, and our customers seek other alternatives and things move on faster and faster.
“Strategy (in the past) was all about finding a favourable position in a well-defined industry and then exploiting a long-term competitive advantage. Innovation was about creating new businesses and was seen as something separate from the business’s core set of activities.” “Sustainable competitive is not just ineffective, it’s actually counter productive” says Professor McGrath.
She rightly states:“Think about it: the presumption of stability creates all the wrong reflexes. It allows for inertia and power to build up along the lines of an existing business model. It allows people to fall into routines and habits of mind. It creates the conditions for turf wars and organizational rigidity. It inhibits innovation.