The right people in the right place are key to meeting current and future growth challenges.
In the current rapidly evolving business environment, staying innovative, agile, and resilient is increasingly difficult for corporates. Without the right people in the right positions, meeting these growth challenges can become even more daunting.
Is there a blueprint for building innovation teams that maximize individual contributions to organizational growth?
As summarized below, during our recent Innov8rs Learning Labs on Culture, Talent & Teams, Sebastian Hamers (CEO at Human Insight) shared practical insights on how to have the right people in the right place to achieve growth goals.
The Growth-Curve and Talent of People
In the business world, Growth-Curve or S-Curve is a pattern that applies to everything that "grows", including organizations. This curve consists of four main phases: ideation, investment, scale-up, and maturation. Successfully navigating each phase requires a unique set of resources and mindsets.
As soon as an organization reaches maturity, it becomes necessary to identify and pursue the next Growth-Curve to remain relevant. However, many corporates fail at this crucial juncture, as evidenced by Nokia, BlackBerry, and Kodak. All three were once dominant players in their respective industries but lost market share and relevance due to their failure to identify their "next S-Curve" and adapt their strategies and business models to new technologies and changing consumer preferences.
“As soon as an organization reaches the maturity phase, it becomes essential to identify and pursue the next S-Curve to stay relevant. Unfortunately, this is where many companies stumble".
Understanding an organization's current position on the Growth-Curve can provide valuable insights for both business and innovation leaders. In fact, it can help them anticipate the challenges of each phase, prepare for the future and, most importantly, identify the people required to facilitate efficient growth.
As we all know, innovation requires diversity in terms of skills, capabilities, and attitudes within teams. If we were to place the major characteristics of individuals within a team on a Growth-Curve, we would typically find that talents with entrepreneurial spirits are situated on the left bottom side, namely the early stages of the curve. On the other end of the spectrum (the maturity stage) are individuals who excel at optimizing existing processes. Those in the middle like to roll up their sleeves, test new ideas, and fine-tune business operations. Identifying these characteristics can help build teams that are balanced and better equipped to navigate the various stages of the innovation journey.
It's important to emphasize that individuals have innate abilities to drive growth. These inherent strengths can be further nurtured and refined to expand their potential contribution to various phases of the Growth-Curve, beyond their natural inclinations. However, it’s not feasible for anyone to continuously contribute to all phases of the curve, as this can lead to burnout, as Sebastian notes.
“Innovation is a relay race. Nobody can contribute to all aspects of the Growth-Curve”.
Innovation can be compared to a relay race, where different teams with different skills take over as the innovation journey progresses. Like in a relay race, innovation requires a high degree of coordination and teamwork where each team – from R&D to Sales to Operations to Accounting – has a specific role to play and must pass the baton smoothly to the next team. They all need to work together to ensure that the innovation journey proceeds efficiently. Each team must also understand the progress that has been made by the previous team and build on that to ensure the journey continues without any hiccups.
Collaboration among diverse teams with varying skill sets in different phases is essential. In fact, focusing solely on the early stages of the curve can be expensive and time-consuming. Moreover, not all ideas will eventually succeed in the marketplace. Similarly, focusing only on optimizing the business can lead to complacency and resistance to change, making it difficult to adapt to new market conditions or emerging technologies. At the same time, focusing only on both ends of the spectrum and overlooking the phases in the middle can lead to operational gaps.
In order to avoid all the pitfalls mentioned above and prevent corporates from becoming irrelevant or outcompeted, it's crucial to manage the entire Growth-Curve. This requires a multifaceted, ambidextrous leadership approach that leverages different skill sets at various curve stages.
At this point, you may be wondering how to get started and identify the best-suited individuals for the various stages of the curve. Sebastian introduces the AEM-Cube, an assessment tool that can help you map out how people interact naturally with change and growth. In the following paragraph, we'll delve into the main features of the AEM-Cube and explore how it can be applied to optimize team dynamics in managing the Growth-Curve.
The AEM-Cube: Assessing the Natural Contribution of Your Teams
The AEM-Cube is a valuable tool to assess whether your organization has the right people in the right positions to effectively tackle present and future growth challenges. This web-based questionnaire is quick and easy to complete, with respondents providing self-perception feedback and receiving combined feedback profiles from co-workers or other individuals in their environment. The AEM-Cube is based on the three dimensions of change and growth: Attachment, Exploration, and Managing Complexity. By evaluating individuals' natural inclinations and contributions to overall growth, this assessment tool can help you effectively position and utilize their potential.
One of the key benefits of the AEM-Cube is its ability to construct Growth-Curves that align personalities in a relay-like sequence, matching people’s specific contributions to the successive phases of the curve. It identifies three key characteristics of an individual: first, to which phase of a Growth-Curve the person contributes; second, whether the person is more inclined towards technological or commercial Growth-Curves; and third, whether the person is focused on a specific part of the Growth-Curve or on the integration of larger parts or even the entirety of the curve. Armed with this information, you can ensure that your organization has the right teams in place to successfully navigate the challenges of growth and change.
It follows that the three questions defining the AEM-Cube’s relationship with the Growth-Curve are:
1. Where do people contribute optimally to the Growth-Curve?
2. Is the contribution focused on relationships or content?
3. Is the contribution integrating or differentiating?
1. Exploration Dimension: Exploration vs. Optimization
The first question is based on the exploration dimension (exploration vs. optimization). Here the AEM-Cube helps answer where individuals can best contribute to the Growth-Curve position. As Sebastian explains, a respondent who scores high to the right (the exploratory side) typically has feedforward-steering characteristics that are in sync with the early stages of the Growth-Curve. On the other hand, a respondent who scores high to the left (the optimization side) of the AEM-Cube, typically has feedback-controlling characteristics that align with the later stages of the Growth-Curve.
2. Attachment Dimension: People vs. Content
The AEM-Cube can also provide insight into whether team members are primarily focused on relationships with customers, clients, and users or content. In other words, it is useful in determining if people are more relationship-oriented or expertise-oriented. It’s interesting to note that these two characteristics are interconnected and equally essential at every stage of the curve.
3. Managing Complexity Dimension: Generalist vs. Specialist
Lastly, the AEM-Cube answers the important question of whether a person's contribution is more specialized or more generalist, which is crucial in determining their fit for a particular phase of the curve. Those who score low on this dimension tend to focus less on the bigger picture of the organizational ecosystem and more on their specific contribution, limiting their impact to a particular area of the curve. Conversely, those who score high are highly attuned to the entire organizational ecosystem and the integration of their own contribution, allowing for a more generalist approach that encompasses the whole curve.
What About Innovation Leadership?
Innovation leaders can effectively balance innovation with efficient management of the current business by adopting an ambidextrous mindset that prioritizes both. This requires understanding where resources are needed and ensuring that the right people are in the right positions to achieve desired outcomes. Different skills are valuable at different phases of the growth journey, so it's important to have a mix of characteristics within teams. Sebastian divides the Growth-Curve into three horizons to provide a better understanding of how to put these concepts into practice:
· At the beginning of the curve is Horizon 3, where the focus is on uncovering options for future opportunities and placing early bets on selected options. The desired outcome is to have an initial project plan and project milestones. Here team members should have a high level of Exploration characteristics, with a focus on inventing and generating new ideas. These individuals should be comfortable with ambiguity and uncertainty, have a strong creative mindset, and be willing to take risks.
· As you progress on the curve, you get into Horizon 2, where the focus is on pursuing top-line growth to increase revenue, sales, and market share and attract new customers. The desired outcome is to define investment budgets and detailed business plans. As such, Horizon 2 team members need a mix of Attachment and Exploration characteristics. They should have a solid understanding of the organization's current business model and market position, as well as an ability to identify growth opportunities. These individuals should also be able to take calculated risks and have a strong desire to innovate and pursue new ideas.
· Lastly, on the upper right edge is Horizon 1. Here the focus is on executing to defend, extend, and increase the profitability of the existing business. The desired outcome is to have detailed annual planning and forecasting for growth through adjacencies. Thus, team members need to have strong Managing Complexity characteristics, with a focus on optimizing and streamlining existing operations. They should have a deep understanding of the organization's current business processes, systems, and customer base and be able to identify opportunities for improvement and efficiency. These individuals should also be skilled in project management and focus on delivering results.
By leveraging the AEM-Cube and understanding the characteristics needed for each horizon, innovation leaders can ensure they have the right mix of skills within teams to succeed at each phase of the growth journey.