The book was recommended to me by Tilak Shah, Chief Technology Officer and Chairman of Polyzen, a provider of specialty products and services for the medical device industry. Ideas Are Free, by Alan Robinson and Dean Schroeder, is about the systems and actions necessary to generate a lot of ideas. However, the implications of having a good idea system go well beyond the "mere" generation of ideas. Let’s look at this more closely.
An idea is a thought, conception or notion, and the authors define an idea as beginning "when an employee becomes aware of a problem or opportunity." With important emphasis on "employee," Robinson and Schroeder discuss that ideas are not just for management, as employees can often identify and solve critical problems which management has either missed or ignored. Unfortunately, many companies are far better at suppressing ideas than promoting them. And without the ability to get new ideas, it is impossible to maintain excellence, so an organization stagnates and declines… eventually losing out to competitors who do have fresh ideas.
The authors espouse a critical element of good idea systems: small ideas, defined as "Everyday commonsense ideas that would save a little money or time, make their jobs easier, improve the customer experience, or in some other way make the company better." But it’s no secret that everyone is attracted by big and dramatic ideas. Managers often envision "home runs." However, big ideas come along rarely and unpredictably, plus most problems and opportunities that employees spot will be relatively small, so most of their ideas will be small as well. It makes sense, then, to focus on the generation of small ideas. And from a competitive perspective, small ideas tend to stay proprietary because there are no mechanisms for competitors to find out about them and, even if they do, the ideas are often situation-specific and so cannot be copied.
In many ways, small ideas are more valuable than big ones, and going after small ideas is the best way to get big ideas. This can be facilitated by asking the right questions such as:
1) Can this idea be used elsewhere in the organization?
2) What other ideas does this one suggest?
3) Are there any patterns in the ideas that have come in?
Beyond the ideas themselves, empowerment around the generation and implementation of employee ideas starts a virtuous cycle. As employees see their ideas being used, they begin to feel valued as part of the team and become more involved. As managers see this change in attitude and the impact that ideas have on performance, their respect for employees grows. Employees are trusted with more information, training, and authority. This in turn leads to even more and better ideas – and the cycle continues, ultimately creating a positive, high-performing culture. Did you ever think about ideas in this way before?
The authors note that most business leaders manage from financial measures, which are almost always lagging indicators, focusing on the past. Idea generation, however, is a leading indicator of future performance. Regarding lagging indicators, Don Wainwright once remarked that he could beat Pete Sampras at tennis if Sampras watched the scoreboard while he watched the ball. Businesses are in constant search for meaningful leading indicators, and metrics around idea generation can be exactly that.
How to reward employees for generating ideas is frequently an area of confusion and, actually, demotivation, when handled improperly. Seemingly commonsense reward schemes can create a tremendous amount of non-value-adding work and undermine teamwork and trust. The authors recommend the following three principles regarding reward systems:
1) Rewards are based on higher-level aggregate measures that reflect the broad and collective impact of everyone’s ideas.
2) Benefits are distributed to all employees, equitably and across the board, according to transparent and publicly-stated rules.
3) The idea system and its reward program are integrated into the way the company is run.
Since idea systems can be very different from one organization to another, the authors suggest that an effective idea process has eight key characteristics:
- Ideas are encouraged and welcomed.
- Submitting ideas is simple.
- Evaluation of ideas is quick and effective.
- Feedback is timely, constructive and informative.
- Implementation is rapid and smooth.
- Ideas are reviewed for additional potential.
- People are recognized, and success is celebrated.
- Idea system performance is measured, reviewed, and improved.
We noted previously that many companies are far better at suppressing ideas than promoting them. So be warned: often the real bottleneck to ideas is not the employees’ lack of creativity but management’s inability to listen to them. As the authors write, "It makes little sense to waste resources stimulating more ideas from employees, if you can’t handle the ones you already have." So if you have issues in this area, work on improving them before piling additional ideas on top of a broken system or an unwelcoming culture.
Again, looking beyond the ideas themselves, the authors discuss that "Organizations with good idea systems have learned that there is a strong link between culture and the flow of employee ideas. This is why an idea system, whose performance can be measured and managed, provides such an effective way to improve corporate culture." Think of the opportunities your organization has with an effective idea system and an open culture. Is your organization generating enough good ideas? Being open to new ideas is one of the first steps of getting new ideas! Here’s hoping that your company gets all the new ideas it needs.
Side note: Tilak Shah and Polyzen practice what they preach, as you will find an easy way to submit ideas to Polyzen right on their website.