Innovation is a Team Sport

Indifference, Hostility, Isolation Are Obstacles to Healthy Innovation

BusinessWeek said it well. In most companies, just about all the cards are stacked against the nurturing of innovation, especially the kinds of new ideas and disruptive innovations that generally lead to major changes in the marketplace and within the business.

Following are some of the behaviors observed in companies throughout the years that have convinced us how difficult it is to create an environment in which innovation can flourish.

Indifference

While just about every CEO and senior executive of a company pays lip service to innovation, many do not really mean it. They mouth the words—it would be politically incorrect not to embrace innovation—but they do little beyond that.

That’s not because they are not good, smart, and highly competent people. It’s just that innovation is not a part of their DNA. The majority of executives make it to top positions by being very good operational managers: meeting sales objectives, improving products and services to keep up with competitors, supporting existing customers and acquiring new ones, managing mergers and acquisitions, achieving the required financial results quarter after quarter, and so on. These management jobs are very tough and getting tougher, given our rapidly changing, fiercely competitive, global business environment. Being a good manager takes very hard work, attention to detail, and organizational discipline.

But as executives rise up in the organization, other skills become increasingly important. They need to transition from being a manager to being a leader.

Management is about business results and processes. Leadership is about people. The key quality you need in good leadership is passion—the urgency to attack and solve the complex problems that all organizations face. To do so, you need to be surrounded by highly talented people, and you need to find a way to transmit your passion to them, so they will buy into your vision of the future, perform at the highest possible levels, and come up with innovative solutions to the challenges of achieving the vision.

When skies are blue, a company might be able to cruise along with top managers who are indifferent leaders. Such managers are typically executing tactical, incremental strategies where the critical ingredients are good, disciplined management as well as operational excellence. But once the skies begin to darken, as they inevitably do, such managers will get into deep trouble, and often end up taking a business down with them. Their most talented innovators and strategists, those whose skills are now badly needed to help set the business on the proper course, have either long departed or become so disenchanted that they have nothing left to give.

Hostility

In general, managers who do not actively encourage new ideas and innovations in their organizations do so because of indifference. They will typically listen politely to your new idea, provide some encouragement, and offer good advice. If they are being honest, they will tell you they barely have the time, energy, and budget to help much beyond a pat on the back now and then.

But some managers go beyond indifference. Their initial reaction to any new idea is negative, if not downright hostile. This is particularly true if the idea comes from someone outside their own organization.

Some of them also exhibit characteristics that many of us would associate with being a bully. Typically, the corporate bullies I have met have achieved their high management positions because, despite their poor interpersonal skills, they are very good at other parts of the job. Sometimes, they are excellent innovators themselves, but given their autocratic tendencies, innovation for them is a one-man or one-woman show. They tend to be poor team players: collaborative innovation is not for them.

Such hostile behavior is hugely detrimental to a healthy innovation environment. People championing new ideas, especially if they are potentially disruptive new ideas, are going against the grain of what the business is currently doing. Rejection is painful, especially coming from people in positions of authority. Senior managers can nurture those new ideas through positive words and actions, or they can stop them on their tracks by being overly negative and combative.

Isolation

I strongly believe innovation is a team sport. The 2004 National Innovation Initiative report observed that innovation is multidisciplinary and technologically complex. It arises from the intersections of different fields or spheres of activity. That is why it often takes a group of people who are not only highly talented but who bring together diverse skills and points of view in order to successfully tackle the kinds of complex problems we face in the 21st century.

But perhaps even more important, a collaborative approach to innovation helps provide the energy and emotional support that new ideas need in their very early stages. New ideas are almost always rough and ill-formed at first. In my experience, nothing works better than bouncing ideas off other, supportive people. This back-and-forth dialog is crucial in helping to shape the idea into something more concrete, understandable, and actionable. Then it is more ready to face the tougher challenges and criticisms from line management and others in the organization.

That is why isolating people in organizational silos is one of the biggest obstacles to innovation. Companies that are serious about innovation do everything possible to break down silos and encourage communication and collaboration across the organization and beyond.

Fostering innovation is very hard, especially if the innovation is disruptive in nature. A spirit of innovation and collaboration does not come naturally to an organization. For such a spirit to take hold, it must become an integral part of the company’s culture. None of this is easy, but it is what a company must do if it truly wants to create a healthy environment in which innovation can flourish.

Inspired by BusinessWeek and Irving Wladawsky-Berger, who retired from IBM last year after a 37-year career at the company. He is presently working on technology and innovation with IBM and Citigroup, and is a visiting professor at MIT and Imperial College.

Michael F. Arrigo

Michael Arrigo brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health IT, and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations who provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and medical billing, fraud damages, as well as electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, medical malpractice, insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software SA (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls IT audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and is published in Healthcare IT News.

Leave a Reply