Genius at work

Instead of waiting for lightning to strike, smart companies are creating systems to cultivate innovation throughout their ranks.

About a year ago, software maker Intuit brought a group of VIP customers, industry analysts and media to a New York loft-style art gallery for a tour of its latest products and early-stage concepts. The setting may have seemed an odd choice for a company best known for its accounting applications, until guests saw what was on display. A huge video presentation of street maps, for instance, showed how companies can leverage the firm’s location-based data, while consumer offerings included an app for Google Glass eyewear that lets users pay for purchases literally through the blink of an eye.

Just as remarkable as these cutting-edge innovations, however, was a session that took place away from the din in an unassuming glassed-in room. It offered visitors a glimpse into the brainstorming process that Intuit’s global staff uses to cultivate breakthrough ideas. The technology was surprisingly old-school — there wasn’t so much as a laptop — but with whiteboards, sticky notes and markers, would-be innovators were given a task: identify a potential customer with an unmet need and develop possible solutions.

Here’s how it worked. Participants zeroed in on a fictitious professional in her mid-30s who was trying to maintain a healthy diet despite a busy travel schedule that made menu-planning and eating well a logistical nightmare. On the first board, they placed sticky notes that captured the hypothetical customer’s essential needs: perhaps she was time-crunched, or just poorly organized. On the next board, they put their ideas for a product or service — everything from apps to a food-delivery concierge — to get her eating better. The final board was a place to take the best ideas and then develop ways to test or pilot them. If nothing emerged as a must-do at that stage, it was time to go back to the beginning and make sure the individual’s need was truly understood.

This carefully designed step-by-step approach, which forms the basis of Intuit’s Innovation Catalyst program, is just one example of the ways in which organizations are trying to formalize a system of cultivating creativity throughout their ranks — with the hopes of staying ahead of the curve in a rapidly changing marketplace. Innovation, after all, is the driving force behind the success of companies such as Apple and Google — and can make the difference between staying profitable and becoming yesterday’s hot commodity.

For a well-established firm such as Intuit, which has been around since the early 1980s, having a built-in process for innovation that allows employees at any level to contribute ideas and challenge the status quo can be critical to continued success.

"It happens almost all the time, where leaders at a certain level see that their current approach to their market or product or service is, if not declining, then running out of runway. Meanwhile, the whole organization is structured around maintaining the current way," says Mark Kuznicki, chief strategy officer for The Moment, a Toronto-based consultancy that helps government and private-sector organizations become more innovative.

Innovation programs, whether internal or consultant-based, are meant to transcend such attitudes and the best ideas can come from anyone, even rank-and-file staff, adds Kuznicki. "The innovation process is about letting go and embracing the unknown, and also reigniting that creative spark that they have left dormant."

Those in Intuit’s Innovation Catalyst program, which is open to all staff, spend at least 10% of their time trying to light that spark, sometimes meeting formally but more often working with cross-functional teams. That’s how a group of Intuit engineers began discussing the unlikely subject of rent cheques. The program provided a forum for staff — some of whom were renters while others were owners with tenants — to talk about the various challenges of tenants getting cheques in on time or of landlords collecting payment from multiple rental properties. The group’s research included attending a homeowner’s association of about 20 people and interviewing 15 landlords. This eventually led to SparkRent, an online service that allows landlords to send out virtual reminders to tenants, who can then pay their rent through a web app.

While the time and resources Intuit invested in the project paid off in this case — SparkRent is the company’s first product to compete with e-commerce giants such as PayPal — no innovation process will produce winning ideas every time. Even so, a program such as Innovation Catalyst is particularly important for the local headquarters of a large global company such as Intuit because it ensures good ideas come from everywhere, says Intuit Canada president Jeff Cates.

"In many globally distributed organizations, often what you end up with in a country like Canada is more of a sales and marketing office," he says. "Employees don’t feel empowered to go beyond their day-to-day work and influence the direction of the product or service."

The risks inherent to innovation may be what hinder so many organizations from pursing it more aggressively, says Michael Grant, director of business and industry strategy with the Conference Board of Canada in Vancouver. According to Grant, co-author of a 2013 report called Culture and Innovation: The Secret Sauce, innovation should be considered both an art and a science.

"By science, I mean that you have some system for evaluating and knowing what’s working and what isn’t working today. The art is that in many cases you don’t really know — or it is difficult to know a priori — what’s going to work and what’s not going to work tomorrow," he says. "These things that people try where they take down walls (in an office) or have people organized in a different way, it’s the experimentation without absolute measurement that’s an art."

According to Kuznicki, there is only one truly universal metric for innovation: can an innovative idea be implemented and does it create some kind of value? A series of workshops his firm led with Bell Canada, for example, helped the company develop a new strategy for implementing request for proposals (RFP). One part of the plan was to involve call-centre employees in the design of apps they might use on the front lines. This in turn helped the company respond more quickly to lucrative RFPs from clients. That may not sound like a stroke of genius, but getting to those changes in established firms is a challenge in itself, says Kuznicki.

Terry Stuart, chief innovation officer at Deloitte, agrees change isn’t easy in a Canadian organization that’s more than 150 years old with 8,000 employees. He has been with Deloitte for 17 years, beginning in a series of e-commerce and digital positions, and was appointed in 2011 to act as an innovation change agent.

Since then, one of the major changes at Deloitte has been the development of AsOne, a method for collaborating that has been turned into a book and an iPad app. It debunks the notion that there are only two major styles of leadership: the traditional command-and-control model and the newer collaborative model. Instead, AsOne outlines eight distinct archetypes of collaboration.

The "architects and builders" archetype, for example, requires a leader with a strong vision (the architect) to help the builders bring what seems like an impossible vision to life by offering them some freedom within clearly defined goals. In contrast, the "captain and the sports team" archetype operates with minimal hierarchy and focuses on carrying out very scripted, highly repeatable tasks. AsOne has not only been used by Deloitte internally, but also by clients around the globe.

Another significant change at Deloitte since Stuart took the CIO role: innovation is now a factor in the way employee performance is recognized and rewarded. The metrics for innovation could include how much revenue an innovative project or product generates, or the number of times the firm is hired to conduct innovation assessments or consulting for its clients.

Previously, Deloitte’s innovation was driven by enthusiastic individuals. "Until I had our leaders and our staff trying to get rewarded for innovation, only the people who were the natural innovators were on board," says Stuart. Now, sustainable innovation is part of Deloitte’s core values, with employees from all over the company taking part in innovation town hall discussions, workshops and other idea-sharing forums that allow anonymity, so that bias doesn’t get in the way, he says.

Still, Stuart cautions that even if companies are able to adopt a pervasive innovation mindset, they will fail without the time and funding to see new ideas through. "If you’re taking a bank and fundamentally changing how it interacts with its customers, that doesn’t happen in one year," he says. Instead, he suggests trying some pilot projects in a small area of the business, such as introducing an online chat tool for customer support in a single city or region. If it works well, the tool or approach can become a part of what the bank does everywhere.

Another way to think about innovation is as a portfolio of investments, says Kuznicki. An innovation portfolio will contain some ideas that work well immediately and others that may take more time to mature. For example, coming up with a way to allow customers to make payments with bitcoin may not pay off until it’s clear the virtual currency will be accepted by mainstream consumers. On the other hand, if video rental firms such as Blockbuster had invested in streaming video earlier on, they may not have lost customers to services such as Netflix.

Using a portfolio approach can also help assign a budget to innovation, as well as measure some results, Kuznicki says. "The long-term thinking needs to be brought toward this: are people starting to behave in new ways with each other and with customers? Are we just solving problems as they are, or are we looking at the underlying sources of problems?" he says. "You start to shift the whole behaviour of the organization to ‘innovation is just how we do things around here.’"