“Helping employees at a large company see the connection between the nebulous concept of innovation and the everyday world of corporate reality isn’t an easy task,” Rolf Kleiner, Kelly Services Chief Innovation Officer and a CIMS Industrial Fellow, observed in our March/April 2013 issue, pp.12-15. Kleiner then proceeded to delineate the steps the company had begun taking to create a culture of innovation. He continues that account with the update below.
Kelly Services has a long and rich history of innovation. Nevertheless, in 2012 Kelly President and CEO Carl Camden decided the company needed to harness the kind of innovation that creates entirely new markets, as it had done in 1946 with the launch of the temporary staffing industry and in the decades that followed with the industry’s first large account model, the formation of Kelly Educational Staffing, and a Talent Supply Chain Management approach to global workforce design.
Consequently, Camden formed the Office of Innovation (OI) with three main purposes in mind: to foster disruptive innovation for Kelly, to significantly improve the efficiency and effectiveness in bringing innovations to market, and to develop an enterprise-wide innovative culture. I was named Chief Innovation Officer.
My charge was to “identify and pursue disruptive, new business opportunities” to fill the gaps that were starting to show in the workforce solutions industry. I was also given the perhaps tougher job of “align the entire organization behind these opportunities.”
Camden and I knew that new innovation projects wouldn’t stand a chance if Kelly didn’t transform into a culture that thrives on risk taking and agile decision-making. We knew that individuals who are engaged in meaningful work and who have autonomy to make decisions and speak out about issues are more innovative. We also knew that being open to change contributes to innovation. Cultures where it is permissible to take risks and learn from failures also contribute to innovation.
First, Get the Facts
To determine what it would take to maximize Kelly’s innovation and growth, I turned to the Center for Innovation Management Studies for assistance. CIMS had developed several valuable diagnostic tools to help companies better manage innovation. These tools, when taken with an eyes-wide-open approach, enable companies to uncover weaknesses, discover strengths and develop useful insights and strategies. Additionally, they help make decision-making more predictable and less overwhelming. (Learn more about these tools at http://cims.ncsu.edu/tools-assessments/.)
CIMS created a custom survey tool that fit our size, business strategy and global footprint. The tool contains four components:
- Innovation Management Maturity Assessment (IMMA). A maturity model that measures the ability to manage ideas, markets, portfolios, platforms, and projects—five critical competencies successful innovation organizations possess. Based on 30+ years of CIMS research on the best practices of leading corporations, the IMMA has been administered to more than 10,000 people in more than 70 firms to date.
- Value Innovation Questionnaire (VIQ). A more in-depth tool that measures the culture of the organization and its potential to create value. This insight is vital for any company embarking on a major change program.
- Participant’s demographic information. The real power of the assessment is realized when it is expanded to take into account the organization’s demographics, because organizations don’t have just one culture but are a collection of subcultures. Information about where the participant sits in the organization (e.g., their geographic region and office location, business function, position, seniority with the company) provides useful data for making relevant and detailed action plans.
- Write-in comments. Participants can express their perceptions of innovation and what they think should be done about it.
How IMMA Works
The IMMA measures a company’s level of innovation management proficiency. It reveals strengths that can be leveraged together with innovation management gaps where improvement actions can be focused (1).
A side benefit is that IMMA is “self-teaching,” meaning that survey participants learn what innovation management is and what it takes to be successful. In this way, IMMA provides the organization with a common language, which is an important ingredient in any transformation initiative.
What VIQ Adds
Value Innovation is a powerful concept. It is built on the premise that creating meaningful customer value requires the collective efforts of the company’s entire value chain (e.g., sales, operations, finance). Companies that are value innovators tend to redefine problems and frame them in terms of performance criteria that matter to customers. They are also more likely to think and act beyond their usual business and delivery processes. This powerful idea was behind the research and development of the VIQ.
NC State professor and CIMS researcher Lynda Aiman-Smith led the team that developed the VIQ (2). Participants answer 33 questions that examine the nine cultural factors proven to be indicators of an innovative organization.
- Meaningful work
- Risk taking
- Customer orientation
- Agile decision-making
- Open communications
- Business planning
- Business intelligence
- Learning organization
Creating an Innovation Culture
Like the IMMA, CIMS has administered the VIQ to a number of organizations, but never in tandem with the IMMA. Given the charge to “identify opportunities for disruptive innovation and align the organization behind them,” CIMS recommended we use both assessments. These two tools, combined with demographic data and write-in comments, provided the facts needed to begin acting on that charge.
Our inaugural survey results, in 2012, served as a baseline for understanding Kelly’s ability and capacity to innovate. Subsequent IMMA surveys consistently identified Idea Management and Organization & Culture as key areas for improvement; the VIQ verbatim comments told us that Kelly employees wanted to participate in innovation but were struggling with the “how” and wanted frequent communication about innovation. With this knowledge in hand, we implemented the following initiatives.
Take Innovation on the Road
Even before the baseline survey was conducted, I set out to help our employees around the world understand they have an important role in generating the creativity that enables innovation to flourish, and that they need to think differently in order to develop and nurture ideas.
With input from Kelly’s Global Learning department and other resources, we created two-hour innovation road shows for employees to learn firsthand how idea generation and collaboration can power innovative solutions to real-world business-related challenges. (For details, see my article in the March/April 2013 CIMS Innovation Management Report.)
More than 40 road shows were conducted around the world and virtually over a one-year period. Upon completing a road show, attendees became members of Inno-voice, an online community on the company’s internal social media platform. Inno-voice enables employees to stay up-to-date on and participate in sharing ideas, news and research about innovation. The Inno-voice community quickly grew to more than 800 members, and continues to inform and inspire employees to engage in innovation.
Recruit Network of Innovation Champions
Shortly after the road shows were launched, I established the Innovation Champion role to leverage the knowledge and insight of Kelly employees, further respond to the question of “how” they could engage in innovation, and help drive our innovation culture.
Innovation Champions take an active role in Office of Innovation (OI) projects and activities. They can work in any role anywhere in the company, and as they gain knowledge and proficiency in innovation, they will lead and sustain Kelly’s culture transformation. Employees interested in becoming Innovation Champions must be:
- Proactively engaged in their work
- Naturally curious with an appetite to learn
- Genuinely enthused about Kelly’s strategy and the change leadership efforts necessary to execute it
- An inspiration to those around them, seeing opportunity where others see obstacles
- Interested in what Kelly is doing as a company
- Able to see the “big picture”
These Innovation Champions are on the front lines of change leadership efforts required to help Kelly maximize its innovation opportunities. Currently we have 22 Innovation Champions spanning multiple countries and diverse professional disciplines.
Being an Innovation Champion has other advantages. Champs attend the monthly conference calls I lead to discuss key projects or issues in the Office of Innovation. This exposes them to information that’s directly related to our long-range strategies and direction, offer their input and ideas, and volunteer to work on OI projects.
To stay in touch between conference calls, I established a private online group for the Champs on our internal social media platform. We use the platform to communicate sensitive, timely and critical information, as well as to solicit engagement and feedback on key issues, problems or opportunities in the innovation space. Each week, I post my calendar to the private group and invite the Champs to attend any internal or external meetings that pique their interest or align with innovation projects or initiatives they are working on.
Establishing a community of Innovation Champions has unknowingly tapped a great source of employee passion in the workplace. Most of our Champs are high-performers who love a challenge and have a natural curiosity to experiment. In addition, they’re willing to go the extra mile to make a difference at Kelly. Many have enjoyed the opportunity to work with other Champs they might not otherwise have crossed paths with, given Kelly’s vast size and scope.
One Kelly Champ explained what she finds most rewarding about her role: “Being in a room with really smart, forward-thinking, risk-welcoming people—even from outside of Kelly—is incredibly rewarding … it’s a chance to elevate yourself beyond the comfort of your desk and be a part of something even bigger.”
Rewarding Employees for Ideas
Idea Management is defined as “having the ability to effectively identify, assimilate and qualify information regarding new technologies or ideas that can lead to highly differentiated, breakthrough products and services.” Mastering the ability to manage ideas — along with changing the organization’s culture — is essential for producing disruptive innovations. When the foundation for Idea Management was being introduced at Kelly, I established a few guidelines: the effort should be outcome-driven, open and highly collaborative. Consequently, the Ideas tool we created became the intake for all ideas submitted globally, accessible to all employees worldwide through both our global intranet and our social media platform.
The tool allows them to submit, comment and vote on four categories of ideas: process improvement, innovation, technology enhancement, and new product development. In addition to meeting the guidelines, this approach embraces transparency and risk taking. All ideas submitted—and their comments and votes—are available for every employee to see.
More than 400 ideas were submitted during the first three years of our innovation journey.
In conjunction with the Ideas tool, we introduced an Innovation Incentive program to help embed an innovation culture throughout the company by encouraging employees to generate and submit innovative ideas. Through the program, employees may be eligible for a bonus when their disruptive or incremental ideas are approved to proceed through the respective processes, and when disruptive ideas are approved for implementation. Employees whose disruptive ideas make it to implementation are eligible for a payout equal to 1% of the first-year projected operating profit, to a maximum of $10,000.
Disruptive Business Opportunities
Kelly defines disruptive innovation as ideas with potential to disrupt and transform the workforce solutions industry. Ideas submitted to the Ideas tool that are identified as disruptive are vetted through a three-stage innovation process: discovery (assessing the idea), incubation (testing the idea) and acceleration (scaling the idea to take to market). Today, three years into Kelly’s innovation journey, several key disruptive innovations are in the process pipeline.
Innovation Champions are deeply involved throughout each stage of the process. The knowledge and experience they gain is preparing them to eventually coach fellow employees who have submitted disruptive ideas. As coaches, the Champs assist with articulating the idea’s value, market and qualitative and quantitative business case.
Introducing Innovation Champions into the OI process is considered an industry best practice. They are the shepherds who introduce disruptive ideas to the OI. They then guide the ideas through the discovery phase by assisting with the templates necessary to obtain approval to advance to the incubation stage. If the idea is approved, the Champ becomes a key stakeholder on the project team; this involves designing the experiment, performing a pilot test, documenting pilot performance, and building the business case to obtain approval to advance to the acceleration phase.
Because, as we expected, projects encountered setbacks as well as successes, we established time and performance thresholds to help determine when it might be necessary to suspend or advance pilots through the process. During one pilot, I invited an external expert to assess the company’s pilot design and provide input to further “stress test” the assumptions. That feedback and recommendations impacted the pilot’s performance positively, and the project’s momentum increased, providing the team with more credible data on the viability of the idea. This was a huge win for the Kelly team!
Link Innovation Process with Formal NPD Process
Connecting large-scale innovation with the company’s existing new product development (NPD) process was a tall order. The ultimate goal was to align the processes in a way that would enable projects to seamlessly flow from the OI to NPD to the market.
Kelly incorporated the CIMS System for Industrial Innovation (SII) tools and templates into each phase of the innovation process because they offered more discipline and rigor in vetting ideas and positioning them appropriately to advance through the process. Rather than changing the NPD methodology, the NPD process was integrated with the OI process to enable the SII tools and templates to benefit both processes and enhance the idea flow. The SII and its tools are described in Profs. Stephen Markham and Paul Mugge’s new book, Traversing the Valley of Death (3).
Integrating these processes required a thorough review and comparison of the existing tools and templates each process was using. Additional SII tools and templates were adopted if they did not exist in either process. One of the most significant revisions to the new OI process was to involve the NPD team earlier in the OI process, which helped enhanced efficiency when handing ideas off to NPD.
According to CIMS, our effort to integrate the NPD and OI processes is a best practice. Eliminating redundancies, aligning tools and templates, and closing gaps between the two processes allowed ideas to flow efficiently and seamlessly from the OI to NPD, ultimately providing faster acceleration to market. In addition to the efficiency and productivity gains, the OI and NPD product road maps are evaluated by leadership early enough in the idea development cycle for a more comprehensive market assessment.
After the processes were integrated and the related tools and templates were in place, we conducted a one-day workshop in partnership with CIMS for the Innovation Champions, employees involved with the NPD process, and senior managers. The workshop included an overview of the new OI process and the benefits of the integration as well as hands-on team exercises to become familiar with SII tools and templates.
“OMG – It’s Really Working!”
The 2014 IMMA showed marked improvement in all competencies and dimensions. Most importantly, Idea Management (a competency) and Organization & Culture (a management dimension) progressed two levels – from “Ad hoc” (Level 1, where the organization has no concerted focus on innovation) to “Managed” (Level 3, when manager’s actions reinforce the desired new behavior and their goal is to institutionalize the new innovation business model.
This is definitely good news, and it is particularly important because the two factors tie directly to the primary objectives of the OI.
Calculating the arithmetic mean of the scores also supported this progress. Scores improved from 2.1 in 2012 to 2.4 in 2013 to 2.9 in 2014. (In the IMMA process, scores are “heat mapped” to illustrate the organization’s strengths and weaknesses on an easy-to-read display that helps management prioritize improvement efforts (See Figure, next page).
Given the significance of the 2014 survey findings, CIMS verified all competency and dimension ratings. Equally important is the progress in participation over this timeframe. In 2012 there were 600 survey respondents, and two years later more than 1500 people had completed the survey. All three data points show an organization that is maturing and eager to learn and be part of the company’s innovation initiative.
VIQ Reveals Dominant Cultural Trait
Customer Orientation and Meaningful Work dominate Kelly’s “homogeneous” culture. No matter how the data was sliced using the demographic data (e.g., location, position, function), the two factors were rated at the top. This means that, above all, Kelly employees see themselves as serving customers and doing so is fulfilling to them, which bodes well for Kelly Services.
Write-In’s Produce a Small Book
The 2014 survey contained just one powerful open-ended question: “How can Kelly’s innovation efforts to build a more innovative workplace and pursue disruptive business opportunities be improved?”
Even though answering the question was optional, 555 people submitted thoughtful responses. More impressively, more than 46 different categories of recommendations were generated from the data. In general, many of the categories pertained to:
- Balancing innovation with day-to-day activities
- Training programs to impact innovation and performance
- Ways to use data and metrics in innovation
Wrapping Up, Going Forward
Clearly Kelly has made great strides in its innovation efforts. In addition to closing the gaps identified in the surveys, the Office of Innovation has worked diligently to define how the company will drive its innovation culture, establish a means for employees to submit their ideas, and enhance Kelly’s processes for bringing innovation to the market.
Going forward, generating externally focused ideas and processing ideas faster will continue to be a main focus of our innovation efforts. As more employees become involved, innovation will take on a life of its own. The long-term goal is to increase engagement in innovation and continue to embed tools, practices and procedures that will enable innovation to flourish to the point where it simply becomes part of the normal course of business and employees essentially run it themselves.
Kelly has always been an innovative company. What it has now that it didn’t three years ago is a more proactive effort to foster innovation and a well-defined suite of tools for assessing and taking action on innovative ideas. While we are well on our way to maximizing its innovation efforts, there’s still work to be done, and Kelly is well prepared to meet the challenge.
- Paul Mugge and Stephen K. Markham. 2013. “An Innovation Management Framework: A Model for Managers Who Want to Grow Their Businesses,” The PDMA Handbook of New Product Development, pp.35-50.
- Lynda Aiman-Smith, et al. “Assessing Your Organization’s Potential for Value Innovation,” Research Technology Management, March-April 2005.
- Stephen Markham and Paul Mugge. 2015. Traversing the Valley of Death. NC State University, Raleigh, NC; $39.95 hardback, $19.95 paper
Chief Innovation Officer, Kelly Services