Ideas are dime a dozen! It’s all in the execution!
So goes the popular wisdom. Indian start-ups and accelerators keep talking about identifying problems and solving them. True. There are great companies like redBus.in that were built using this approach. However, there are other great companies like Twitter that were not born out of any urgent problems that people had. They developed a short-form, real-time, instant broadcast mechanism that found a thousand uses such as having quick conversations, fighting for freedom around the world, and distributing links to articles, pictures, etc,. Such is the power of ideas that go in directions you never even anticipated. The main point is that ideas are important whether they address well defined problems or someone thinks “Wouldn’t it be nice if….”. They may all lead to innovation that helps start ups scale quickly!
I had written about this subject almost two years ago in two articles here, in the same forum – Is your company dependent on Innovation? Grow the right Culture First! The rest will take care of itself! and Is Software Innovation an Art or a Science? It’s Artful Science or Scientific Art! . Since then, the Indian product ecosystem has come a long way and has seen examples of great exits happening because of innovation. It may be time to enumerate different steps that start-ups could take to make sure they are building an Innovation Culture.
Wikipedia has an excellent definition of Innovation – Innovation is the application of better solutions that meet new requirements, in-articulated needs, or existing market needs. This is accomplished through more effective products, processes, services, technologies, or ideas that are readily available to markets, governments and society. The term innovation can be defined as something original and, as a consequence, new, that “breaks into” the market or society. A definition consistent with these aspects would be the following: “An innovation is something original, new, and important in whatever field that breaks in to a market or society”.
Now you can see why software product companies need to build a culture of innovation. It is key for their differentiation; essential for raising investment money, attracting bright employees and building unique intellectual property.
So how do you exactly build a culture of innovation? Here are popularly recognized steps:
Articulate a Mission and a Vision for the company rather than just end-products – Pixar’s goals were to reinvent the animation industry. Facebook’s mission is to give people the power to share and make the world more open and connected. Google’s mission is to organize the world’s information and make it universally accessible and useful. This does not mean that you encourage your employees to come in and do random things. It just sets up a framework to view existing and future products and draws the lines within which they can innovate.
Hire people who are curious in addition to having the capabilities you need – Innovation cultures cannot be built with people to whom it’s just a job with a paycheck or people who have very narrow interests. Those kinds of people will do extremely well in services companies where a team needs such focused people on some narrow task as part of a larger team. Software product start up companies can afford only so many people and they may need to wear many hats especially at the start of the whole effort. So if you want to build an innovation culture, you need to hire people who have diverse interests and generally curious about many things. Innovation happens more often at the intersection of many interests than in a single focused discipline.
Encourage Ideas – This sounds like a truism but it is one of the most difficult things to do in start up companies, especially with co-founders or management with strong personalities. The first time an idea from an employee is overruled or ignored may be the last time that employee speaks up with ideas again! The founders/CEO need to establish encouragement of new ideas from day 1 or it will be too late for this to happen. It is easy to be busy with being busy in a start up company and not take the time or recognize new and good ideas as they come up in conversations and encourage them.
Encourage Autonomy – Encouraging autonomy is another way of encouraging new ideas. In fact it may be an even better one than soliciting them in company forums. Someone who is expected to produce results rather than dictated steps to get to the desired results may come up and implement new ideas themselves. Accidental and autonomous innovation is just as good anything that goes through formal processes.
Recognize and Celebrate New Ideas – Public and private recognition of new ideas is an essential step in the building of an innovation culture. Man does not live by monetary incentives alone and they may be the least important ones! Start up companies may not have a lot of money to pass around for new ideas, but you could have other incentives such as small stock option awards that motivate good employees even more.
Build a Culture where Failure is not a Stigma – The Anti-Portfolio pages of the VC Firm Bessemer Venture Partners is a great example of celebrating failure quite publicly! . It names the partners who, for whatever reason, passed on some investments that went on and made it big! The message they are conveying mainly is not that these people screwed up, but to encourage taking more risk! In a software product start up, public recognition of the fact that some people tried something, even if they failed, builds the confidence that it is OK to try new things. Fear of failure is something that stops many employees dead in their tracks and they keep new ideas to themselves.
Encourage Big Thinking and Small Experiments – Start up companies cannot afford not to think big and may not be able to afford large experiments. They can, however, encourage small experiments that can validate the big thinking. These experiments ought to be encouraged and employees given the time and encouragement to pursue them.
But innovation comes from people meeting up in the hallways or calling each other at 10:30 at night with a new idea, or because they realized something that shoots holes in how we’ve been thinking about a problem. – Steve Jobs