Why do Powerful Executive Teams Shoot Down Promising Innovation Projects?

Why is it that you can have a fantastic offsite session, and then 48 hours later, put the same people in a room and nothing that was proposed survives?

Perhaps something similar has happened to you:

You’ve just completed a very productive offsite creative session with the senior team and are feeling good.  Pages of clip charts have been developed with 2 x 2 matrices, dot voting and business model mapping.

Then you set up the next meeting.

And the same people that worked to develop all those great ideas suddenly do a Jekyll-and-Hyde turn around and can’t agree on any of them. What changed?

The truth is that the unique and new rarely survive the harsh light of the board room.  And innovation champions frequently feel like they are the subject of hunting season.  Why does this free wheeling environment allow for “creativity,” which disappears once we put our ties back on?

Zooming In

Let’s take a closer look at the key leaders who are usually involved in the innovation conversation inside most organizations.  In looking at who’s involved, along with their underlying drivers and must haves, we can better understand why the pattern is so pervasive and what we can do to use it rather than fight it.

Here is the typical scene at the table:

The person who is charged with running the meeting from a process point of view has collated all the notes, slides and flip charts into a deck.  The table is populated with senior leaders, usually at a minimum someone who has overall responsibility (CEO), someone who has operational responsibility (COO) and someone who is accountable for the business financials (CFO).  Additionally, there is usually a leader who has technical architecture responsibility (CTO) and finally someone who owns the distribution decisions (CMO or EVP of sales/distribution).

Once the first program is re-introduced in the boardroom setting, various leaders begin to immediately shoot down the idea(s).  One objection after another surfaces until the original idea seems absolutely unusable.

What happened to the positive support for the same idea at the offsite session?

Breaking it Down

For the answer, let’s double click one more time for a closer look at the roles of each leader at the table, including their motivations and goals.

As an aside, many firms I work with have one member of the “C” team that doesn’t fit the mold, and in fact stretches it significantly.  This can be the CTO or CIO who is very much an innovation advocate and expands the thinking of the team whenever possible.  These activist “C”’s are big assets, and usually have a substantial influence footprint both inside and outside the firm.

• Our CEO has the widest view and is accountable to the most stakeholders.  It is her role to be sure that all constituencies are considered, and that the business is aligned with the most productive challenges to meet the stakeholders’ expectations.  They are usually the most visionary and long term in their view, but also strongly understand the need to make sure the team delivers on its promises.  When it comes to innovation, they are usually in the front of the pack.

• The COO is charged with building the value delivery machine and is usually accountable for procurement, production and scheduling.  This machine, be it a manufacturing plant or a services delivery function, needs to be repeatable, on time, on budget and high quality.  This makes their take on innovation to be a very big and expensive distraction.

• Our CFO is charged with keeping the firm on track both with current financial performance, but also with good sources of capital by developing a good reputation with banks and the public markets for stocks and bonds.  The usual view on innovation is: “where are we reducing costs to pay for this optional activity?” Secondly, they will be champions of under promising and over delivering to the analyst community.

• The CTO makes sure the technical decisions ensure that the firm has architectural coherence and consistency.  The CTO steers the firm away from dead end technical pathways and makes sure each new platform has a reason for being.  The CTO voice is typically pro innovation – as long as it fits in the fabric of the firm.

• Our CIO is the long-term, big investment person.  She guides the firm in big investments, creates a fortress for data and builds in new capability.  She can see issues far down the road and is always using words like extensibility & usability.  The CIO is usually at odds with short-term projects that impact the longer term agenda.

• Our CMO/EVP builds a value delivery vehicle for a very specific group of clients and customers he knows well and has a well-developed and repeatable playbook.  He is agile and fast moving which creates significant tension.  Surprisingly, this member of the team can be pretty skeptical of the value to the current customer base and be pretty harsh on new projects.

• Corporate Development – Many firms have a dedicated individual that is accountable for bringing the firm opportunities for growth ranging from licensing to full scale M&A.  They are constantly evaluating options and are typically not strong champions of internal innovation due to its longer investment cycles to payback.  They much prefer acquiring after the market risk has been absorbed by the original investors.

The truth is that the C-Team is built to ensure the firm is able to find new space in core markets and produce sustainable and repeatable results, period.  Innovation work is designed to push the firm out of balance, and at the outset, it feels like grit in the gears of a well oiled machine.

When left unchecked, the pattern of thinking that is used to create repeatable results will smother innovation every time.

So, why do innovation at all?

Simply stated, well designed and deployed innovation programs release massive value – substantially above the usual output of the main business.  The returns on the investments of time, money and talent are very high.  High rates of return drives stock price, employee benefit programs and the ability to grow and invest in the firm.

With the innovation imperative well established, how then do we take advantage of all the capability without the start and stop of a typical cycle?  The number one job of the C team is to release the creativity of the firm to enter new and productive markets and service areas.

So then how do we do innovation and take advantage of the full team?  There is a threefold answer to this question.

First is to use the full team to decide carefully on the exact zone that innovation work is to be concentrated. Should it be a particular category of product or service, a specific geography, or an application of a specific set of competencies?  Each member of the C-Team will be able to help shape this “playing field” by sharing their insight, intuition and experience.  An example of this might be a high performance laser range finder for an off-road automated vehicle in warehouse applications.

Second is to use the team to design the process that will be used to build the alternatives.  How will we gather ideas?  Are we going to build it with organic resources, or look to acquire the tech elsewhere?  Will we shop the problem to external sources and incubators?  Who should lead the team and how should they interact with senior leadership?  Once settled, we can give our team real guidance without dictating specific solutions.

Third, we agree on the bounds of risk and expected reward.  What are the budget parameters for this work?  What are we willing to spend and what do we expect to learn?  How often do we expect the group to check back and report into the group?

By deciding in advance and agreeing to what success looks like, it creates a clear zone for the team to roll up their sleeves and contribute in.  These three bounds – what, who and how much allow us to open wide a narrow road.  When we put innovative teams into specific and well bounded areas, great things begin to happen.

When the creatives of the firm are empowered to activate a high-performance innovation activity within this framework, rapid progress is made without the micro management that leads to the shooting gallery review described in the opening of this article.

By using the full skills of the team in the full arc of the process, we can consistently generate ideas and project charters that are on point.  This is in marked contrast to the rabbit trails the team can get on when they haven’t had the chance to engage both their creative and critical thinking skills.

If you would like help customizing your approach to this very real set of challenges, please click on this link and set up a 20 minute, “roll up your sleeves” call with me, or call my direct line at 847-651-1014.

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