This week, I have the pleasure and privilege to review Jag Randhawa’s book: The Bright Idea Box – A Proven System to Drive Employee Engagement and Innovation. Jag had approached me about his new book, having previously read Blue Ocean Strategy. Given that this book is about employee engagement and innovation, two topics I am very passionate and intimately involved with I was very much looking forward to reading and reviewing this book.
As the title indicates this is a book about innovation. Jag begins by making it clear that it is the employees within the organization that drive innovation:
It is never an idea, technology, market forces, or access to capital that makes a company innovative. What differentiates an innovative company from an average company is the people working inside the company.
Subsequently, their engagement level correlates to the level of innovation:
Researchers have long argued that a strong correlation exists between employee engagement and innovation. A highly engaged workforce can transform an average company to an innovative company, while a disengaged workforce can kill a great company.
The main premise of the book is to provide a framework for a bottom up employee driven innovation program:
This book offers a framework to create such a program, in which employees submit ideas to create operational efficiencies, improve business processes, increase customer satisfaction, and grow the business. This book mirrors the program I created at my work after years of reading, researching, and trial-and-error learning…This book is not meant to persuade anyone why he or she needs innovation, but rather to show how to get started on this journey.
Tying this back to employee engagement:
Creating such a program has an amazing effect on employee engagement. Let’s assume for a moment that you get absolutely no good ideas out of this program; then, you will still benefit from increased employee engagement. Establishing this program creates a new sense of worth among the employees, which, by itself, will increase their engagement. They will feel that you value their input— that they are intellectual human beings and their work makes a difference to their company’s bottom line. They will feel they are an integral part of the organization and not a dumb or easily replaceable component . Employee engagement increases trust between management and employees. Every job is important in an organization, and every job can be done better. You need to communicate that to employees. Ask them to look for ways to improve functions, processes, and products. If you feel there is any particular role that is not important or could not be improved, you are not thinking hard enough. Sometimes the problem lies in the definition of the role, and at other times, it is the person in that role. Take appropriate actions to make sure you address the actual problem.
The word innovation has been overused as of late, so Jag ensures he defines it and characterizes it for us:
The essence of innovation is to add value for customers. Inventions that wow people, but don’t add value, rarely survive for long, and they often end up costing more money than they add to the bottom line. For an invention to become innovation , it must add value for customers. The value can come through lowered cost, new features, aesthetics, convenience, ease of use, enhanced experience, or meeting emotional needs. Sometimes the value comes in the form of helping customers make more money , attain goals, or safeguard valuables.
Innovation = Invention + Execution + Adoption
Why is innovation so hard? And why do numerous companies don’t do well/fail in it?
Most companies fail to innovate because they are not receptive to the idea that enhancing existing products is innovative. The grass always looks greener on the other side . They cling to the notion of developing new products, which often end up costing companies more money than the new revenues they generate. This belief is further engrained in their minds by the notion that innovative ideas emerge in full form with “success” written all over them. In reality, this notion could not be farther from the truth.
What are the main areas of innovation that a company can focus on:
These areas of focus for innovation can be broadly classified into four business domains: • Revenue Generation • Cost Reduction • Business Process • Business Model
REVENUE GENERATION The revenue-generating domain of innovation pertains to ideas that contribute to top-line growth. This focus is the most obvious for many organizations, and under this focus, creating new products is the most prevalent strategy.
COST REDUCTION As the name suggests, this domain encompasses ideas that help lower the operational costs of a business. Wal-Mart and Southwest relentlessly focus on providing value to customers through lowered cost. Therefore, ideas that help lower operational costs are given precedence over all other types of ideas.
BUSINESS PROCESS Process innovation is perhaps the most overlooked and underappreciated domain of innovation. In my view, business processes are perhaps the most important domain to innovate— especially customer facing processes.
BUSINESS MODEL Business model innovations address the “how” part of the value proposition of a business. A business model is the overarching process of an organization and explains how it transforms the input of labor, knowledge, material, means of distribution, and other resources into a product or service that customers feel is worth the money they pay for it. Business models also address how an organization acquires and serves its customers, and, at times, how it charges its customers in exchange for the value it delivers. Business model innovations entail changing one or more input resources in ways that deliver value to customers. Most business model innovations tend to be large, strategic initiatives, and you may not see many ideas in the business model innovations category from your employees.
What are the essential ingredients within a company for innovation?
As we discussed in Chapter Two, innovation has three critical components: invention, execution, and adoption. All three pieces must come together for any idea to see the light of day. All ideas face capital, intellectual, technical, and political challenges. These challenges can be overcome only if management creates the focus and employees align their efforts toward that focus and find creative solutions to make the products successful. This alignment and focus can be driven by strong management directives and processes, or it can come from employees as a passion to do great things, be part of something bigger, and make contributions toward a greater cause . The successful companies leverage both to drive continuous innovation.
Is it enough to have top-down innovation or bottom-up innovation?
A good organization is a mix of both top-down and bottom-up innovation. Top-down innovations are very important for dreaming big. Without top-down innovation, we would have never set foot on the moon, built the personal computer , or promoted personalized healthcare. It is the job of visionary leaders to push boundaries and constantly disrupt the market with new and innovative ways to add value for customers. However, leaders cannot be involved in every activity that goes on inside an organization . As the company grows, the only way to succeed is through delegation. The question then becomes: Are the delegates engaged at the same level as the leaders? Is their intent, energy, and focus aligned toward the same vision? Do they feel like part of that vision? Do they see themselves as an important piece of the puzzle in bringing that vision to reality? Creating a bottom-up innovation program can also be instrumental in bridging the gap between strategic intent and execution. When employees are more engaged, they provide superior service to customers and come up with ideas from a very diverse perspective that often gets missed in a top-down view.
Jag makes a very valid observation – and a key differentiator for this book – in that although attention has traditionally focused on product innovation it can and should also apply to services:
As I started my journey of innovation, I found that Service Industries have been largely neglected by most innovation experts and authors. A lot of books have been written on product innovation that teach how to develop new products, how to create prototypes, how to test markets, and how to build demand for novel products, but very limited literature exists on how to innovate in the Service Industry.
Subsequently, the framework for rolling out an employee-driven innovation program is introduced:
In the following chapters, I’ll introduce the Six-Step M.A.S.T.E.R. Innovation Program. Here are the steps: STEP 1: Mobilize STEP 2: Amass STEP 3: Support STEP 4: Triage STEP 5: Execute STEP 6: Recognize
The first step in creating the Bright Idea Box program is to define and document the program’s vision and purpose. A clearly defined purpose statement will help ensure the entire workforce is marching in the same direction. The purpose statement should be a working document that captures the program’s essence, how it works, and the types of ideas you are seeking. It should be a three-part document outlining the purpose, objectives, and guidelines…This purpose statement is the overarching and simplified vision of the program that serves as a guiding beacon for employees who are thinking of new ideas, as well as those responsible for supporting and ensuring that valid ideas get implemented in a timely manner…The second part of the document should outline the area of focus and the program’s business objectives. The program’s objectives should be closely aligned with business goals and values…The last section of the purpose document should outline the guidelines for participating in the program. In this section, you can include what and who is outside the scope of this program.
For this reason, at the heart of this program is an easy to use and easy to access Idea-Capturing System, which is available to all employees to capture ideas when they are fresh in their minds.
Idea Questions: 1. Name: What is the name for the idea? 2. Description: What is a brief description of the idea, including what problem it addresses and how it solves it? 3. Benefits: What value or benefits will the idea deliver to the customer or company? 4. Cost-Benefit Rationale: How much will it cost to try or implement the idea? Does the cost justify the benefits?This information is like a mini-business case for the idea. For an idea to be accepted and implemented, the employee must provide answers to all of these questions .
The most important thing employees need is support and encouragement from management, and a little bit of freedom to contemplate and develop ideas. Creating an environment where management encourages employees to submit and develop ideas is the most important investment you need to make. You need to create an environment where employees feel comfortable bringing out the issues inside the company , flaws in the business processes , and weaknesses in your products.
The next step in building the bottom-up employee innovation program is to create effective means for screening and prioritizing ideas…The best way to accomplish this is to form an Idea Screening Committee that meets on a regular basis to review newly submitted ideas and discuss changes to existing ideas.
Once an idea has been approved and financed, it must be implemented in a timely manner. Without a clearly visible process and a push from the top, an idea can easily vanish into the vast depths of corporate bureaucracy. As part of designing the program, you need to decide how you are going to test and implement ideas. You need to flush out who is responsible for implementing the ideas and what type of commitment you need from the impacted parties…There is no faster way to kill the innovation program than by not implementing good ideas.
The final step in developing the program is deciding how to recognize employees for their ideas and efforts. Recognition is the lifeline of the Bright Idea Box. Setting the right kinds of rewards is critical to the program’s longevity and ensuring that employees stay motivated to submit new ideas . Recognition is an opportunity to encourage desired behaviors and reward employees for thinking and acting in ways that add value for customers and the company.
What are some key leadership principles to help develop employees into innovators?
Below are the four leadership principles that play a vital role in developing and transforming employees into innovators. DRIVERS OF HIGHER ENGAGEMENT 1. Ownership: Give people responsibility and ownership. 2. Personal Growth: Grow people on a personal level so they can grow professionally. 3. Solution Mindset: Foster a Solution Mindset that promotes progress. 4. Partnership: Treat employees like partners so they will act like partners.
Ownership—Ownership instills a feeling of pride. Nothing motivates people to do more than pride. People work a lot harder for pride and often go to extremes to prove themselves. How can you take advantage of this human condition? Make employees the boss. Give them responsibility.
Personal Growth—Growth is the fuel of the soul. Without growth, even the masters can lose interest.
Solution Mindset—A solution mindset is a problem-solving approach that recommends that, no matter what the problem is, your first response should always be how to solve or get around the problem…A solution mindset, on the other hand, encourages progress. The goal is to keep moving forward. No matter what the problem is, focus on how to get around it and make progress…A solution mindset, on the other hand, encourages progress. The goal is to keep moving forward. No matter what the problem is, focus on how to get around it and make progress…To foster a solution mindset, tell employees that you are not interested in who or what caused the problem. You are only interested in hearing how we plan to go beyond the problem.
When launching the innovation program it’s important to sell it to all stakeholders:
To launch the Bright Idea Box program, you need to appeal to the rational and emotional brains of three distinct stakeholders. First, the top management, the executive leadership team in the company. Second, the middle management layers, and third, the front-line employees. I recommend that you create distinct sales pitches for each group to address their functional needs.
What are skills that we can all work on to further enable our innovative thinking abilities?
I have compiled a short list of skills that you can share with employees when you roll out the program . This is by no mean a comprehensive list of skills or techniques, but rather a starting point and enough to jump-start employees’ innovative thinking abilities. It is a short list that employees can easily understand and put to use immediately.
CURIOSITY Curiosity is perhaps the most imperative trait of all innovators. Being curious about what is on the other side and why things are the way they are is a great tool for making breakthrough discoveries.
LISTENING Customers are always telling us what they want, but employees on the other end are often not listening. There is no incentive for them to put up with customer complaints all day.
MINING Every frustration presents an opportunity. Instead of getting frustrated and blaming others for incompetence, mine your frustrations to look for ways to solve the problem…1. Not stopping at the first obstacle 2. Keeping a positive attitude 3. Always learning 4. Collaborate— share and ask for help 5. Solution finding rather than complaining.
BORROWING We like to believe that our problems are unique, but more often they are not. Often the problems we are wrestling with have been solved by others in different industries and in different products. Steve
NETWORKING The most innovative ideas often lie at the intersection of two different paths. We get some of the best ideas when we network with people from different disciplines .
WRITING Ideas often come when we are not looking. This is because of how our brain works. Our cognitive brain, which is responsible for decision making, has a limited capacity to process information, but our intuitive brain, which works in the background, can process a lot more information and make new associations that trigger aha moments…ideas. The second limitation of our cognitive brain is its ability to convert short-term memory into long-term memory. Often we get ideas, but they get lost in the rush of a million other things to do and remember. For this reason, recording problems and thoughts is essential to generating ideas.
PROBLEM SOLVING…ASKING “WHY” FIVE TIMES…REVERSING THE CHALLENGE…PROTOTYPING…
Getting a flywheel started takes a lot of energy— you push, and you push, and you push. Then with every turn, it becomes easier and easier to turn the wheel . And finally, it starts to generate its own momentum and what once took an enormous amount of energy becomes almost self-sustaining. It is the same for starting a bottom-up innovation program . It is a cultural shift and you will need to make a really strong push in the beginning and keep pushing until it gains momentum. With time, the recognition and the buzz created by this program will create a desire among employees to submit ideas. Pretty soon, you will have ideas pouring in at a speed faster than you can handle. The key is not to stop pushing.
What sets this book apart is its high degree of practicality – Jag has thought through and included the material not only to introduce the framework itself but how to operationalize it successfully – which is typically the harder part.
A recommended read in the area of innovation and employee engagement.