In your organization, does innovation mean finding new ways to exploit what you already do well, or exploring arenas where you're unfamiliar and will make mistakes? Or both?
If you simply tell your employees and leaders that you want them to "innovate," then even the most motivated and intelligent employees might steer their efforts in the wrong direction. For example, consider the difference between two pivotal innovative contributions employees could pursue in the car industry: making existing cars safer and more attractive for human drivers (exploiting the present), versus making cars that don't need drivers at all (exploring the new).
"Exploiting" offers immediate and familiar payoffs, but can trap an organization in improving what will one day be obsolete. "Exploring" offers potentially disruptive high payoffs, but can produce chaos and gut-wrenching short-term losses.
HR leaders have the opportunity to help companies get beyond the generic idea of "innovation," and be clearer about how innovation is pivotal to strategic success, and how different innovator behaviors support different innovation types.
The "Ambidextrous" Organization
In a Harvard Business Review article in the early 2000s, Charles O'Reilly and Michael Tushman described the conundrum of an organization that tries to be both exploitative and explorative: "ambidextrous" organizations. An ambidextrous organization is one that "requires executives to explore new opportunities even as they work diligently to exploit existing capabilities"—not an easy feat, as the authors highlight.
The authors review showed that ambidexterity can improve organizational performance, but only if exploratory and exploitative innovation are well balanced. How can you balance these two efforts? The authors suggested separating exploratory innovation departments from those doing exploitative innovation, but making sure that senior executives in all departments communicate about their efforts.
For HR leaders, this is an important lesson not only when it comes to organizational design, but also when it comes to talking about employee purpose. You must help employees clearly understand whether their job is explorative or exploitative, and help senior executives in their pivotal role of communicating between team units.
Taking a Cue from Biology
Consider how a natural ecosystem must evolve differently between the two contrasting strategies shown below, where the vertical axis is the payoff, and the horizontal axis is evolutionary innovations.
The left-hand diagram has one peak, so organisms can evolve to the highest level by incrementally improving their current state (exploitation). The right-hand diagram is a balance of both: It has a high peak, but with many lower peaks and valleys between. Reaching the highest peak requires exploration — innovations that reduce the payoff from the current state, but place them on the path to the highest peak — balanced with exploitation to improve along that path.
Applied to organizational innovations, this suggests that exploiting only works if there is one best solution related to existing best practices (the left-hand diagram). However, balanced exploration and exploitation are needed when the highest-payoff solution requires progress through lower-payoff innovations in the valleys.
Why a Balance Is Best
A 2016 paper in Nature by Daniel Barkoczi and Mirta Galesic tried to simulate how innovators can balance "exploration" and "exploitation" in innovation. They found that it was both less productive to over-emphasize exploration (i.e., tap lots of ideas and pursue the most popular) or to over-emphasize exploitation (i.e., tap a few ideas and pursue only a clear incremental payoff), compared to balancing both.
HR leaders, this suggests how you can better support your innovators. You can clarify the vital difference between exploratory and exploitative innovation, but you can also help innovators navigate paradoxes. Like an evolving ecosystem, reaching the highest peak of innovation may require counter-intuitive practices like seeking out fewer ideas and pursuing the lower payoff (but popular) ones.
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Alexander Mann Solutions wins Cornerstone OnDemands sponsored categories at the TIARA 2020 Talent Solutions Awards
Here at Cornerstone, we absolutely love to hear inspiring stories and share them far and wide, especially when they are about talent management! We were recently headline sponsors of the TIARA 2020 Talent Solutions Awards. These annual awards, hosted by TALiNT International, celebrate excellence across the RPO, MSP and Talent Solutions marketplace, and recognise the wonderful ways companies are demonstrating exemplary growth, innovation and leadership. For 2020, it was the usual great awards with a bit of a difference. As we know, everything has now moved online – even this year’s Convergence! But this didn’t seem to impact the TIARA Talent Solution Awards at all. Despite not being able to celebrate face-to-face, the event was filled with laughter, engagement, and most of all, lots of fun! This year, we also supported the Best Use of Technology Award as well as the Overall Winner. The winner – triumphing in both categories – could not be more deserving, and so we duly wanted to pass on our huge congratulations to Alexander Mann Solutions! Alexander Mann was awarded the Cornerstone OnDemand Best Use of Technology Award for their brilliant ‘Find Your Fit’ technology solution. The platform offers users personal preferences and assisted future growth through interactive videos, personalised one-to-one calls, and a dedicated platform to match skills with current roles within the organisation. The solution had 1,200 employees enrolling within just six months of implementation and is continuing to improve every day. Find Your Fit helps employees to understand how their organisation functions better, including the areas that are growing the most rapidly. In turn, this helps employees to develop the skills they need in order to take advantage of these developments to enhance not only their personal career progression, but overall business performance. After all, businesses don’t innovate, people do! The judges commended this entry for “the clear way in which an innovative technology solution clearly delivered in results”. The judges also applauded Alexander Mann for demonstrating customer care by really listening to client’s individual challenges and using inventive technology solutions to help design a custom built solution that helps to support the overall internal career options and pathways available to each organisation. The award was accepted virtually by Stephen Gordon, Recruitment Tech Lead at Talent Collective/AMS. In addition to being awarded Best Use of Technology, Alexander Mann was also recognised as this year’s overall winner of the Talent Solutions Awards. Chair of Judges, Jim Richardson highlighted that “the overall winner is based on the organisation that consistently demonstrates excellence and innovation across all of its activities”. Both Peoplescout and Guidant Global were highly commended by the judges for their brilliant work, but ultimately, Alexander Mann took home the award for demonstrating consistently high standards across all areas. Jim Richardson added that although Alexander Mann has the resources to support many initiatives, it has still managed to deliver consistently on large scale and complex global projects. This is a phenomenally impressive achievement that all of us at Cornerstone also wish to say a huge congratulations for! The other winners and nominees from this year’s TIARA Talent Solutions Awards have highlighted more excellent work and brilliant stories across the recruiting sector and HR community. For the full list of winners, check out the TALiNT International’s September/October 2020 edition here.
Blog: Why HR need to lead the agile change journey
It's been going on for a while now - the shift towards more agile and flexible companies that quickly can adapt to the fast-changing times of today. Organisations that are unable to make this move are gradually losing competitiveness and finding it more difficult to prove themselves against smaller and faster players. Those who recognise the need and are able to create new conditions for the business, in the form of new structures, will survive and flourish in tomorrow's economic reality. Agile HR can be viewed from two different angles; How HR should work together within the HR team and what / how HR should deliver value to the business for which they exist. All HR processes that are part of Talent and People Management will be different when you start working agile, and each of the processes have their specific tools and working methods. Here we will look at HR from a more general perspective, to get an overall understanding of how the HR role, and the corresponding deliverables, change in a company that wants to increase its business agility. The goal is to focus on creating better workplaces through the development of teams and individuals, throughout the whole organisation. Small and medium-sized companies are easier to change, as they have less hierarchical structures, and often a more decentralised business, where everyone has an ability to make the decisions that need to be made, locally rather than centrally. The larger and more complex a company is, the more systems, processes, and structures there are that cannot be easily and quickly changed. Although it is possible to change a department in the organisation, some issues might remain that forces the department back into the central structures. This happens because it is not possible to isolate a specific part of the business. You can compare it to an attempt to change a rubber ball. It changes when it is being squeezed, but when you let go, it quickly returns to its old shape. However, there is one functional department in most large organisations that can influence all the other parts at once – HR. In many large companies, HR controls; ● Leadership programs and development ● Change management ● Organisational development ● Employee engagement ● Employee training and skills development ● Rewards and bonuses ● Recruitment ● Goal setting and performance reviews ● Long term mix of employees All these processes or areas flow through the entire organisation. These are the structures that can support, or prevent, a more radical change towards a more agile company. It all depends on HOW we work with processes and programs. They can be developed in a way that, paradoxically, prevents performance and commitment. Or they can optimise performance and employee satisfaction. HR struggles with criticisms, it is accused of being some kind of "organisational police", which hinders performance and commitment by implementing Talent management processes in a way that was intended to increase the same. This needs to change. HR has been in the back seat for too long and now it is time to take responsibility for a change in how to support the organisation. Because it is about people, and relationships between people, this is the key to how the company performs as a whole. It is the system that fundamentally needs to change, not the people. We do not need to do more things or implement complicated frameworks and methods. Instead, we need to understand how we can make it easier for people to make their best contribution to the company, by providing supportive structures, instead of hindering structures. It is through more experiments and by trying different working methods, that one can find the best path for each organisation, and each team/individual. Here, the agile principles and the agile mindset serve as a guide. Agile tools and frameworks work sometimes, but not always. The only way to continually improve is through constant learning, which also means that we sometimes fail. Companies that learn faster than others, and turn that knowledge into new ways of working for employees, but also new products and services for external customers, gain a competitive advantage and will be the winner of the future. HR has the power and the ability to design the structures that aim to either support or make it harder for employees to contribute in creative and innovative ways. If HR sticks to the old, traditional ways of working, the consequence will be rigid and non-agile organisations that use inefficient systems and processes. HR can either hinder or support the change, so HR must show the way. By providing opportunities for alternative and more agile working methods, and by focusing on value creation and value flows for the internal and by extension also external customers, HR can lead companies through changes that no other department is capable of. The next blog chapter will dive into HR's changing role.