Innovation can be a troubled topic at the best of times. Often conflated with digital or cutting edge technology, innovation runs the risk of being little more than a flag bearer for the champions of the digital age – Facebook, Apple, Amazon, Microsoft and Google. Throw Netflix into the mix and you have a collection of the most successful and disruptive businesses of the last 40 years.
However, innovation is more than this. In the classical economic sense, it consists of three distinct phases: idea generation, experimentation and distribution.
The companies above are all successful examples of business ideas that have been tested, iterated, and scaled. And the activity of capturing and generating ideas, conducting experiments, and taking the learnings through to developing and scaling new business models is as relevant to the age services industry as it is to technology companies.
The key question for aged care is: what can we learn from the technology sector in terms of innovation methodologies, tools, techniques, and culture?
Most importantly I believe it is the cultural element that will have the greatest impact. This is because the methodologies, tools and techniques can all be learnt but without the right culture, innovation will not flourish.
At its simplest, culture is what the people who make up your organisation say and do – or what they don’t say and what they don’t do. There are three key ingredients that are specific to innovation culture within any organisation: leadership, diversity and inclusion. Like any good recipe, the interaction between these is critical.
Leadership – the tone from the top – matters as much for innovation as it does for risk culture. In risk culture we often say the behaviour you walk past is the standard you accept. And so it is with innovation. What leaders say and do about innovation is critical.
How do you talk about innovation? Do you ask others for their ideas (your people, your customers, your suppliers and other stakeholders)? Do you encourage experiments? Do you tell stories of success and failure and the learning? Do you provide funding? Have you aligned innovation with strategy? Do you actively create time and space for innovation to occur?
Leaders need to be servant leaders (leaders who exist to serve the organisation). To innovate you need to create both the permission and space for innovation to occur. This means a different communications posture needs to be adopted by leaders. Your communication strategy needs to create an organisation that can listen to its people and consumers, capture weak signals of change, and allow the ideas to come forth.
Diversity facilitates the richness of these ideas and the ability to experiment and distribute successful innovations. Today, most high performing organisations realise the general operational benefits that come with diversity as it relates to gender, race, ethnicity, religion and identity. Perhaps less well known is the innovation dividend that comes from it.
Diversity is critical to innovation because, for both ideation and experimentation, you need diverse thinking and capabilities. For truly innovative ideas to come forward, ideas need a mix of people who can see opportunities and problems, see potential solutions and challenge those solutions. You will get better quality ideas where there is critical reflection and challenge; and you only get this by having diverse input.
This means extending beyond organisational boundaries into supply chains, consumers and beyond. A broad outwards orientation will enhance the diversity of your organisation and will in turn lead to a more curious workplace. Equally, when it comes time to test and experiment new ideas, having diverse capabilities matters. It is one thing to come up with an idea and another to execute it.
Inclusion matters. To build a culture of innovation you need to make it possible for everyone to contribute and participate. This is why setting up innovation teams, innovation labs and research and development departments can either hinder or advance your innovation agenda. The very existence of these groups can create the perception that innovation is their responsibility alone.
To be inclusive requires active encouragement and the creation of direct opportunities to participate. Campaigns need to be run to encourage everyone to contribute. Tools such as crowdsourcing or activities like ‘hack days’ (days where staff from across the organisation come together to build out ideas and prototypes) are a useful way to do this. They can also build skills and capabilities by giving practical experience in human centred design, lean startup, business model canvas or new technologies. This becomes even more powerful when linked to real organisational challenges or consumer problems that have the potential to advance the strategic aims of the business, because it shows participants that you value their input.
Nothing that has been outlined here is the sole domain of technology companies. Much of it comes back to the attitude and posture adopted by the leaders within aged care. By building an innovation culture, you are giving your organisation the best chance to deal with the current uncertainty and change within the industry.
innovAGEING Expert-in-Residence for Innovation
Partner, KPMG Innovate
Associate Director, KPMG Australia