Innovation Governance – Adding Guidance and Essential Support
Posted By Faye
Date: August 24th, 2010
Category: Business
Companies and organizations turn to governing boards for so many critical elements these days.
Boards of Directors guide overall strategy and direction. Appointed Audit Committees pore over corporate financials and performance. HR / Compensation Committees ensure the organization’s on track with hiring and benefits that keep it competitive. Each has been formed to inform, advice and support the CEO in his or her the ethical- and policy-backed pursuit of protecting shareholder / stakeholder interests.
Yet in the Age of Sarbanes Oxley-like governance across the organization, why doesn’t innovation have such oversight?
While attending the CEDEP ” Innovation-In -Action” this April at the Insead Business School’s Europe Campus in Fontainebleau, France, business leaders and top minds in innovation mulled the importance of creativity and new thinking in the organization. We discussed how innovation “tournaments” can drive critical thought, how capability-building drives ROI amid investable propositions, and how to create and nurture innovation champions from the bottom up who overcome organizational resistance.
At the CEDEP event, I spoke with Andrew Sleigh, the former group Managing Director and Chief Technology Officer with robotics and defense contractor QinetiQ, and an adjunct professor at London’s Imperial College. Andrew is a strong advocate of innovation governance. His beliefs in many ways mirror the 10 Imperatives in Robert’s Rules of Innovation that are required from a Governance perspective. Andrew espouses – among eight concepts, the value of innovation, skills assessments, and creating incentives to reward effective efforts.
Innovation Governance would require appropriate audit capabilities to measure outcomes, a board-level framework to ensure input and involvement, and explicit engagement with executives across the organization – just like any company or organization faces with SOX-type governance. A Chief Innovation Officer and or CEO would be getting board mental and policy backing.
Without this framework – and governance oversight, many innovation initiatives fail to take deep-seeded root within the organization.
The real issue boils down to the well-being of the organization – and the board’s willingness to create an environment that fosters sustainable health and continued growth. Governance with regard to innovation is more than just another committee. Competitive forces – especially in organizations that have been leaned-down, streamlined and fat-trimmed to the bone – beg the wise, thoughtful implementation of innovation. Assuming board members and executive leadership agree that we’ve lived through the decade of growth through Mergers & Acquisitions, and maxed out the value gained from lean manufacturing and operations, profitable growth drivers will have to be derived someplace else.
I would argue that well-considered innovation and related intellectual property will be the growth driver in the 21st Century. To make that happen, you need to elevate innovation higher than just the CEO or a C-level innovation exec. Beyond his or her required inspiration. It will have to encompass the entire C-Suite, the board – and the governance policies that guide them.
During the MacWorld Conference and Expo last January of 2008, Steve Jobs announced the launch of iTunes rentals and promised to be able to offer at the very least, 1,000 titles for consumers to rent by the end of February. And since February is over and coming in to mid-March, the number of titles tallies between 400 to 600 movies, and this is a big embarrassment to the Cupertino-based company.Apple CEO, Steve Jobs blames “those pesky studios and their rights agreements are once again the problem. Many of the movies Apple wants to offer on iTunes were released before Internet distribution was a possibility, meaning that download royalty agreements have to [be] signed between studios, actors, and copyright owners. As we’ve seen from the WGA strike, arguing about royalties tends to take time, but Apple is saying that the 1,000 titles will be available ‘soon.’”According to other news sources, the quality of audio and video doesn’t fit to what Jobs expects to offer to consumers of the iTunes store. Some HD movies don’t use Dolby Digital 5.1 and is quite disappointing.Apple Fans must not worry and would not wait in vain for the success to happen. It only takes time before the industry and the market adjusts to the business model of the iTunes store. Just like when the store started in 2003 where it measly offered 200,000 cuts but now has over 6 million songs