Your biggest enemy?
Fear is the enemy of innovation – that is the very big message from the latest research. If you want to develop an innovative, far-sighted business, then you have to be aware of the two types of fear that could destroy your vision, your organisation’s innovation efforts and even your capabilities as a leader.
The two compounding fears
There are two compounding types of fear that top-level leaders really need to be aware of in their organisations. Both these fears inter-act dangerously with each other in a ‘compounding’ manner. Each of the two ‘compounding fears’ sit at different, but highly influential levels in the organisation.
The real problem is that over time, these fears inter-act, severely limiting the organisation’s capabilities and future vision.
So what are they?
The Fear of Disruption: The first ‘compounding fear’ is the fear of change in the outside world, a dread of the threat of disruption in the organisation’s established markets. In this research, and in many organisations, the task of ‘scanning the periphery’ remained solely with top-level management. In this arrangement, where top-level managers deny the existence of disruptive forces and continue to press middle-level managers for greater levels of growth, then a second fear can germinate, this time at middle management levels.
The Fear of Failure: This is the middle management-level fear factor. Continuous pressure for more and more growth (such as relentless ‘stretch targets’) can breed a ‘good news only’ culture. A fear of bringing bad news to top-level management encourages middle-level management to report in an overly optimistic manner, keeping the bad news back.
Both these fears are bad enough on their own, but from an organisation’s perspective, these two fears can inter-act to produce a dangerous cocktail especially for top-level leadership. Denial of the threat of disruption, which might be a more common phenomenon than many think (see one example here), coupled with ‘good news’ reporting from middle management, can lead top-level leaders to dangerously over-estimate the capabilities of their organisations in a world that they see as benign, but in reality is hostile and volatile.
But there is another problem for leaders. By denying the existence of change, leaders are potentially limiting their own skill and competency development. These factors can contribute towards dangerous levels of, as the researchers in this study say, ‘temporal myopia’ at the top of the organisation.
So what can be done?
There are at least two lessons from this study.
The first is that the job of ‘scanning the periphery’ isn’t one just for top level management. It’s one for managers across the organisation and at least there should be an open and constructive debate that encompasses both top and middle-level management. There is a strong argument too that business-level managers should be involved as frequently they are the first to see the signs of change in the competitive environment.
The second is to be aware of the dangers of ongoing ‘stretch targets’ particularly in a world of slowing growth. Organisational exhaustion is one the two main ‘killers’ of businesses – as I’ve highlighted in an earlier briefing.
Another lesson is the the danger of having strong, unchallengeable values in the organisation. As time changes, we must be prepared to challenge and change our assumptions and the role of leaders must be to craft an environment where such ‘constructive challenging’ can take place.
 Vuori, T and Huy, Q (2016) Distributed Attention and Shared Emotions in the Innovation Process: How Nokia Lost the Smartphone Battle Administrative Science Quarterly 61(1): 9-51