Every emerging middle market company that Newport works with must define and secure its vision of the future. At the same time, the company’s present may at times seem precarious. The gap between where a company wants to go and where it finds itself right now can look very wide.
Bridging the gap between a precarious present and a promising future calls for strategic leadership, which I define as “thinking, acting and influencing in a manner that significantly changes outcomes. “ Most entrepreneurs want to get on with the “acting and influencing” part of this leadership. It’s the “thinking” step that often proves the most difficult. Most CEO’s are in fact prepared to think long and hard about their next move. The problem is that a CEO’s mindset tends to be self-limiting, driving him or her to do “more” (of the same) instead of “different” (from what they have done in the past). And “different” is often what is called for if a company is to reach its next stage of growth.
“Different” is another word for innovation. Business innovation typically shows up in three dimensions:
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products and services
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business processes
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business concepts
No single dimension will drive growth beyond 2 to 3 percentage points. All require persistence. Research suggests that it takes 1500 ideas to deliver just one successful new product. Once a company’s business processes have become routine, they are hard to change - especially when they span organizational boundaries. As for innovative business concepts, they are hard to institutionalize in a company that has become set in its ways. Just try bolting a subsidiary with a breakthrough concept onto an established company.
My experience with business innovation has taught me that there are mindsets that are necessary pre-requisites for innovation. The first mindset is a desire for personal change. How much more productive many CEO’s would be if they spent more time quietly looking inside themselves, asking himself “what’s the primary gating influence on our company’s growth?”; “how can I personally be contributing more to this influence?” and “what’s the highest-leverage use of my time against it?”
It is impossible for an organization to “transform” itself if its members – particularly the ones in the top team – dismiss any thought of changing their own behavior by saying “that’s just the way I am.” For an organization to truly change, a critical mass of people in it must fundamentally alter their perspectives on themselves, their working relationships and the world in which they live.
Individuals always undergo significant change before organizations do. Any genuine assessment of “readiness to change” must go well beyond markets, channels, technology or “them.” It’s never up to “them”. Think about what the change you say you want from your company might call for from you. Ask for honest feedback about yourself and your performance...then listen. Tell people what it is you are willing to leave behind for the sake of a future that that is better than the one you are currently headed toward.
My next article in this series will be about information as the fuel for innovation.
About the Author
As a CEO, Director and Advisor to CEO’s on strategy and governance, Mike has compiled a track record of navigating complexity, refining business models and cultivating leadership. Learn more or contact Mike directly here.
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