Faster Delivery = Happy Users
Automated Process = Fewer Errors
Standards = Cost Reduction
Order Visibility = Confidence
Linking Systems = Efficiency
According to IBM, there are three very different types of C-suite executives. In a report presented at IEF 2018, they laid out the differences. They call the classes the reinventors, the practitioners, and the aspirationals. And the first thing to know about these classes is that the reinventors are the leaders. They outperform their peers both financially and in terms of innovation. They make more money and they make it in more interesting ways.
So, we all want to be reinventors, in some way. Even if you’re not a C-suite executive, it behooves you to adopt the traits of leading executives. Nearly anyone can steer their company in a better direction by doing this.
Thanks to IBM’s research, it’s not all that difficult. The report, “Incumbents Strike Back: Insights from the Global C-suite Study,” clearly outlines how reinventors are different. The good news is that difference is a set of habits and outlooks that can be duplicated. And it starts with a focus on innovation.
Being a grassroots leader
When we think of an innovative executive, we might think of Picasso in a suit—a businessperson with an artist’s soul. But being an artistic genius isn’t how reinventors generate innovation. They don’t do it on their own. Instead, they create cultures of innovation. And that means letting non-executives generate ideas and insights.
After all, any large company is filled with hordes of employees who know their roles better than any central committee ever could. They see potential efficiencies that leaders won’t. Reinventors embrace this. They think of employees as “scouts on the front lines,” rather than drones. Accordingly, they don’t hesitate to look down the ranks for new ideas. 75% of them solicit lower-level employees for new ideas, and seven out of ten trust them to generate their own solutions.
In practical terms, creating a culture of innovation also means keeping bureaucracy minimal. This lets new processes percolate swiftly. That’s why only 25% of CEOs in reinventor organizations say they’re hampered by bureaucracy. Considering how often you hear complaints about bureaucracy in general, this is quite a low number.
But employees aren’t the only source of reinventors’ innovations. They’re also experts at using data in unconventional ways.
Using Data Like Designers
These days, any company larger than a mom n’ pop store uses big data somehow. But reinventors use it especially well. They use it to generate ideas for new products and business models, rather than just using it to grade current practices. Moreover, data is only one part of their multifaceted way of getting to know their customers.
For example, a lot of reinventors use customer journey maps. 65% of them say that they’re very effective at it. By using this process, faceless data can be assembled into a springboard for new ideas. Previously invisible pain points become visible. Conceptual understandings of customers take shape—and archetypes emerge from the data.
Another part of this is co-creation. Reinventors are eager to directly incorporate customer and partner insights into new products. One reinventor organization, DHL, has engaged in over 6000 customer co-creation events. This has lead to Parcelopter, a new drone delivery service, as well as many other new products.
6,000 is a high number. How does DHL find the time to do that? Part of it is the fact that reinventors do something that might sound paradoxical. They encourage failure.
When we hear about innovation in Silicon Valley, a lot of what we hear about is disruption. The press loves to talk about new companies that totally destroy old business models. But mostly, this isn’t what happens. Only 27% of C-Suite executives report being affected by disruption in any significant way. Reinventors don’t create earthquakes. Instead, they create continuous change. That guards against stagnation and lessens the impact of disruption if it does occur.
The key element of this approach is rapid prototyping with a great deal of failure tolerance. You can generate innovations faster if you try out lots of different ideas. That involves watching a lot of those ideas fail. So, rather than thinking of failure as a drawback, reinventors think that failure during innovation is actually a good thing. Rather than think of it as wasted time, which should call for punishment and soul-searching, they think of it as the byproduct of exploration of new frontiers to help course correct for future endeavors.
This is perhaps the most interesting takeaway from IBM’s report. From the outside, successful executives seem like professionals who experience constant upward momentum. But from the inside, it’s not like that. Reinventors don’t just experience success constantly. They stumble into pitfalls and go down dead-end roads. But they’re not afraid of that. And this is how they climb the mountain to success.