Can't Innovate? It's Management's Fault (Really!)

Can't Innovate? It's Management's Fault (Really!)

Business strategy guru Gary Hamel blames obsolete management practices for your failure to establish a culture of innovation. One solution: Stop focusing on efficiency.

CIO: What skills do technology managers need to be innovative?

Gary Hamel: I don't think you can improve innovation performance unless you understand where innovation comes from.

Number one, innovation comes from challenging industry dogma. You can teach yourself and you can teach others how to be contrarian. Ten years ago in the airline industry, every CEO would have said that the only way to compete was by running a hub-and-spokes route system, until Southwest and JetBlue changed those rules.

Number two is understanding the early warning signs of big shifts in demographics, technology, regulation or whatever it may be that most of the industry simply isn't paying attention to. I talk about Whole Foods in the book. If you look at the trends on which they built their business model -- people becoming more concerned about what they were eating, about the integrity of the food chain, about the impact of herbicides and pesticides on the environment -- these are things you could see emerging for the last 25 years. But traditional supermarkets weren't paying attention.

The third kind of personal competence you need to innovate is a deep empathy with the hidden or unarticulated needs of your customers. If you understand the frustrations you're causing them, you start to understand there's something you could do differently.

I think the last competence as an innovator you need today is you can't think about your company in terms of what it makes and what it does. You have to think of it in terms of what it owns and what it knows -- its strategic assets. Then you can say, OK, what else could we do with these? Companies stop innovating when they end up hostage to a very narrow definition of who they are.

CIOs need to be the most creative people in their organizations and therefore, they need to have those skills.

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