Why 3.0 Companies Struggle with Innovation

We all know that the 4th revolution has upended the world and companies that dominated the 3.0 business world have been heavily impacted. Banking, newspapers and physical retail are just some of the businesses that have been turned on their heads, as their lunch is being eaten by innovative competitors, companies that might not initially have even seemed like competitors. Online payment companies being a banking case-in-point.

Not surprising, 3.0 companies are struggling to get their heads around the constantly changing playing field. They’ve rightly identified Innovation as a key driver of sourcing new strategies and opportunities. Many of these 3.0 companies have promoted Innovation, naming it as a Company Value, and elevating it as a capability to be developed, possibly even invested in some Innovation training or brought in some key hires with proven Innovation credentials. All solid actions towards developing an organisational capability.

What if that’s not enough, though? What if there’s something else that is constraining such companies from nurturing and embedding innovation? When discussing concepts with leaders, some leaders quickly grasp the concept while many struggle. They want detail, they get engrossed in specifics rather than the broader idea. When facilitating organisation design or strategy workshops, they struggle with what might be, constrained by what they know to currently be. They can see what’s in front of them but find it difficult to imagine how things could be.

What causes this difference in style? The answer lies in Carl Jung’s work and subsequent assessment tools such as Insights Discovery and Myers-Briggs. The findings from Jung’s theory, and related tools, show that people tend towards being introvert or extrovert, feeling or thinking. The third spectrum is how people absorb information. Some people are Intuitive while others are Sensing. Intuitive people tend to see the possibilities of what can be, love concepts and ideas, and focus on meaning rather than words. Sensing people, on the other hand, tend to see the specifics of what is in front of them, take the literal meaning of words and like practical examples.

Not surprisingly, Intuitive people are more likely to embrace innovation, enjoy exploring possibilities and having opportunities in bring ideas to life. Sensing people are more likely to enjoy business-as-usual work or taking concrete ideas that have been mapped out in detail and bring them to fruition. Research has also shown that the population doesn’t break down into a 50:50 split between Intuitives and Sensors. The split is more like 25:75.

Implications for 3.0 Companies and Innovation

• 3.0 companies, by definition, are very established and haven’t needed much innovation for decades. Given 75% of the population are Sensing and we hire people like ourselves, these companies are likely to be full of leaders with a preference for Sensing. This is not a fertile ground for introducing Innovation.
• People with a preference for Intuition are more drawn to start-ups, distuptive industries, product design, creative fields. This naturally reduces down the number of available Intuitives for 3.0 companies to attract.
• Where Intuitives have reached leadership positions in 3.0 companies, they are likely to be heavily outnumbered by Sensors, so innovative initiatives are likely to be thwarted. Over time, Intuitives become frustrated with being able to see how things need to change while not getting any support or momentum to realise it.

How 3.0 Companies Can Access Innovation

1. Isolate their innovation hub/team from the mainstream company. This gives them the freedom to explore options and develop nascent ideas, before they see the light of the Sensor day. Many large companies have gone this route.
2. Actively recruit Intuitive leaders and alter the ratios. Depending on openings, staff turnover, etc this could take time.
3. Regularly war game and scenario plan what might happen, to help Sensors explore what could happen in a more tangible way. Paul O’Connor@Scenario Serious Games runs some very interesting corporate games.
4. Have monthly Innovation sessions, facilitated by an external facilitator who is Intuitive and experienced in idea generation tools and techniques.
5. Invest in start-up companies that complement business strategy. Many of the pharma companies have adopted this strategy.
6. Partner with an Innovation & Strategy company, that allows regular access without upfront costs. Many of the big consulting houses, such as Accenture and Deloitte, are providing this service. Smaller companies also work in this space.

How Best to Move Forward

The first port of call is determining the current preference make up of the leadership team. That might be just C-suite or could extend 1 -3 levels down. This could be done via an assessment tool such as Insights Discovery (please feel free to contact me, to discuss further). Once the extent of Intuitive preferences within the cohort is understood, and the extent of innovation required and investment budget available is determined, the best strategy to access Innovation can be selected.