Building an Innovative and Creative Culture Michael Harmelink

Building an Innovative and Creative Culture Michael Harmelink Vice President, Gartner Executive Programs June 13, 2018 © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. This publication may not be reproduced or distributed in any form without Gartner's prior written permission. If you are authorized to access this publication, your use of it is subject to the Usage Guidelines for Gartner Services posted on gartner. com. The information contained in this publication has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information and shall have no liability for errors, omissions or inadequacies in such information. This publication consists of the opinions of Gartner's research organization and should not be construed as statements of fact. The opinions expressed herein are subject to change without notice. Although Gartner research may include a discussion of related legal issues, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner is a public company, and its shareholders may include firms and funds that have financial interests in entities covered in Gartner research. Gartner's Board of Directors may include senior managers of these firms or funds. Gartner research is produced independently by its research organization without input or influence from these firms, funds or their managers. For further information on the independence and integrity of Gartner research, see " Guiding Principles on Independence and Objectivity. "

Discussion Premise • Digital Business is moving forward at an accelerated pace. • Industries and products once viewed stable have been, and will continue to be, under siege from competition – both traditional and unexpected. • Cost pressures are only escalating. In order to win and/or survive, every organization must innovate. • Innovation must be customer focused – both internal and external. • Creativity is essential to customer focused innovation. • An innovative culture is built intentionally and is driven by teams. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. 1

Digital Business The creation of new business designs by blurring the digital and physical

7. 4 B Personal Devices 30 B 250 M Things Businesses © 2017 Gartner,

The Innovation Imperative Major Digital Disruptions: Internet of Things Smart Machines and Robots 3 D Printing Reimagining Organizations and Industries Increasing Speed: Agile Development Lean Startup Crowdfunding Experimentation as Strategy Quest for Digital Talent: Employee Engagement Crowdsourcing Balancing Human/Machine Contributions © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. Innovation as Culture

What Is Creativity? © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

What Is Creativity? Working definition: The act of generating something novel that is perceived as valuable by a community. § Original § Practical, intellectual or aesthetic § Unexpected § Sharable § Advances current state § Contextual © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Is nature or nurture the biggest driver of creativity? © 2017 Gartner, Inc. and/or

Can Minds Switch Modes? Nature: Innate personality, predisposition and traits Mode 1 Reliability Consistency Expertise Best Practices Business as Usual © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. Nurture: External environment, context and influence Mode 2 Agility Ambiguity Creativity Innovation Experimentation

Nature Matters © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Nature Matters "Big Five" Personality Traits Overall Job Performance Teamwork Innovation "Maverick" Behavior Extraversion X x x ü Emotional Stability X ü x x Openness to Experience x x ü ü Agreeableness x ü ü x ▬ x x Conscientiousness ü Key: Significant Correlation ü x Minor or No Correlation ▬ Negative Correlation Sources: E. Gardiner and C. J. Jackson. "Workplace Mavericks: How Personality and Risk-Taking Propensity Predicts Maverickism. " British Journal of Psychology. 22 November 2011. S. Yesil and F. Sozbilir. "An Empirical Investigation Into the Impact of Personality on Individual Innovation Behaviour in the Workplace. " Elsevier. 2013. M. R. Barrick, M. K. Mount and T. A. Judge. "Personality and Performance at the Beginning of the New Millennium: What Do We Know and Where Do We Go Next? . " International Journal of Selection and Assessment. 15 April 2003. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Creativity Can Be Measured How many uses can you think of? © 2017 Gartner,

Creativity Can Be Measured J. P. Guilford Alternative Uses Test: • Fluency – number of uses • Originality – how unusual • Flexibility – range of ideas • Elaboration – level of detail A great way to measure divergent creative thinking Personality is 40% to 60% genetic. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

So, What About Nurture? © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

What Drives a Person to Innovate at Work? Personality Demographic Motivation Job Characteristics Context © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. § Creative Personality § Openness § Education § Tenure § Intrinsic Motivation § Extrinsic Motivation § Job Self-Efficacy § Creative Self-Efficacy § Job Complexity § Autonomy § Role Expectations § Climate for Innovation § Positive Climate § Resources § Supervisor Support § Leader-Member Relationship § Transformational Leadership • 17 predictors • 5 categories

Nature Is Not the Most Important Factor Level of Correlation With Innovation Job Characteristics Motivation Context Personality Demographic Role Expectations Creative Self-Efficacy Job Complexity Autonomy Leader Member Relationship Resources Job Self-Efficacy Creative Personality Openness Intrinsic Motivation Positive Climate Supervisor Support Climate for Innovation Education Extrinsic Motivation Transformational Leadership Tenure Source: M. Hammond, N. Neff, J. Farr, A. Schwall and X. Zhao. "Predictors of Individual-Level Innovation at Work: A Meta-Analysis. " Psychology of Aesthetics, Creativity, and the Arts, 2011, Vol. 5, No. 1. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. 0. 44 0. 33 0. 32 0. 29 0. 27 0. 26 0. 25 0. 24 0. 23 0. 21 0. 18 0. 15 0. 14 0. 13 0. 05

And Creativity May Just Be Hiding Creativity 100 90 80 70 60 50 40 30 20 10 0 Age 5 Age 10 Age 15 Adults "What we have concluded is that non-creative behavior is learned. " — George Land Beth Jarman, Breakpoint and Beyond: Mastering the Future Today © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

DNA Is Not Destiny. You Can Nurture Creativity. © 2017 Gartner, Inc. and/or its

Adobe Kickbox: A Tale of 59 Intrapreneurs • Kickbox: Everything you need to innovate • Two-day workshop and limited time allocation • Process for experiments and evidence • Ideas pitched to any executive • Available at kickbox. adobe. com Source: Adobe © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Provide Opportunities If you want to. . . Then try this approach … Envision future states/models/values Workshop or workshop series Solve a tough problem Competitive design Surface unrecognized opportunities Idea challenge/jam Energize a team Innovation day/hackathon Generate breakthrough ideas Internal venture capital program Tap intrinsic motivation Personal projects/20% time Encourage everyday innovation Innovation training and practices © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Goals What should you do to increase your vertical leap? What if we wanted

Trigger Creative Thinking Technique Examples Set stretch goals Shorten cycle time from two hours to two minutes. Explore what-if scenarios with a new technology What if all our IT was "cloud first"? What if we embedded facial recognition in every system? Add, remove or invert a constraint or assumption Find a solution that costs less than $20 or that delivers benefits in under six months. Cannibalize your organization How would a private startup reinvent your organization? Consider adjacencies and connections Who is great at balancing the needs of multiple stakeholders? Inhabit a different world Observe the people you help in their "natural habitat. " Create stories about a day in the life of a key user of the future. Play games and engage the senses "Gamify" idea generation and selection with a virtual currency. Build a model of a process with cardboard and string. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Protect the Big Ideas Through Separate Selection and Incubation How can these ideas be made more realistic? Wow! Idea 1 Idea 2 Idea 8 How Inspiring Idea 7 Idea 3 How can these ideas be made more inspiring? Idea 4 Idea 9 Idea 6 Idea 5 Boring Hard © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. How Realistic Easy

Culture Is Critical to Innovation • Innovation is more complex than in the past: • The business world is connected, networked, integrated, and uncertain; • More innovation initiatives connect or involve multiple processes, products or services; • And, organizations have let the outside in. • Cross-organization change requires complex, adaptive cultures — people must be willing to adapt to the new culture in terms of how they think and how they behave. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Innovation Is Defined by a Cultural Shift The Blind Spot of Innovation … The Sweet Spot of Innovation … Innovation is being first Innovation is ideas that are new to us Competitors will discover our ideas Our competitive advantage is design and execution, not just ideas We don't know how to manage innovation We should start now and experiment to build competence We know what customers want and need Our customers (and prospects) have great ideas If it's "not invented here, " it probably won't work for us We can multiply our innovation capabilities through innovation © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

"Figuring out how to build a sustainable creative culture … was a day-in-day-out, full-time job. And one that I wanted to do. " — Ed Catmull President of Pixar Animation Studios and Walt Disney Animation Studios, in "Creativity, Inc. " © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Establish New Habits 1. Schedule "white space" time for yourself and your team. 2. Start or end every staff meeting with an "innovation moment. " 3. Plan one lunch a week to meet with someone from another department to exchange ideas. 4. Take the first 30 minutes of every Tuesday to search for innovation bright spots in the company. 5. Organize team field trips inside and outside the company. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved. Source: American Express

Where will ideas come from? Who will test them out? Who will make key

Recommended Gartner Research u Create a Research Engagement Plan to Advance Your Innovation Culture and Processes Jackie Fenn (G 00272371) u What a World-Class IT Innovation Charter Should Contain and Why You Need One Mary Mesaglio (G 00200468) u Drive a Creative Culture Through Activities, Education and Attitude Jackie Fenn and Mary Mesaglio (G 00304117) u Driving the STREET Process for Emerging Technology and Innovation Adoption Jackie Fenn (G 00174060) u Overcoming Innovation's Measurement Problem Mary Mesaglio (G 00236813) For more information, stop by Gartner Research Zone. © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.