Leader and Organizational Attributes that Cultivate Innovation

Leader and Organizational Attributes that Cultivate Innovation

By Lieutenant Colonel Paul Gillikin 

Introduction

            The 2017 National Security Strategy and 2018 National Defense Strategy mandated a change to the way the US Government focused on threats. No longer was the mantra a Global War on Terrorism, but a Great Power Competition. Violent Extremist Organizations would remain a serious risk, however, peer and near-peer threats such as China, Russia, and an emerging Iran would dominate the security strategies. Both strategy documents touched on a key theme to compete in this type of environment:  innovation. For the senior Joint Force (JF) leadership, knowing the organization needs to innovate to stay ahead of peer competitors is one issue, but selecting the right leaders capable of discovering and developing innovations is another. The global innovation system is a dynamic environment where large, established companies are increasingly toppled or disrupted by smaller companies with niche innovations of greater value like Airbnb, Uber, and Netflix. It is from these creative-destructive surroundings that the next set of disruptive technologies will be discovered and developed such as quantum computing, artificial intelligence, blockchain, biotech, and autonomous systems. The innovation and digital transformation the JF needs can be solved within. The JF needs to deliberately select innovative leaders that can adapt organizational cultures and processes to influence and encourage the discovery of technologies that can gain an advantage for a long-term challenge such as the Great Power Competition.

Facing the Threat:  The Joint Force and Innovation Leadership

            For the JF to remain competitive in Globally Integrated Operations, it is essential to understand the threat environment and pace of technology. By appreciating the threat and rate of change, the JF can adapt its strategies, funding, research, and acquisition processes and actions to remain ahead of its competition. In Buying Military Tran$formation, Peter Dombrowski wrote, “the Industrial Revolution spawned a mode of warfare that depended on raising, equipping, and maintaining mass armies, communicating via telegraph, moving troops and equipment on railway systems, and controlling the seas with dreadnaught battleships.”[1] Over the last several decades, the JF adapted from a Cold War force structure based on mass to decentralized, deployable, more capable teams to counter terrorists and insurgency movements. The threat facing today’s Joint Force in the Great Power Competition spans multiple regions and domains and yet to be fully realized disruptive technologies. A consequential factor in that is the ability to find those dominant innovations and deliver them to the force before an adversary gains them. For Global Integrated Operations to be successful, the JF must continuously innovate and adapt as:  threats are multifaceted and are not limited to traditional rules, domains, combinations, and thinking of the past, and the Joint Force needs flexibility in planning, management, and development. Most importantly, the Joint Force needs innovative leaders to reduce barriers to action and provide the vision and inspiration to discover and field technology to dominate the convergence of physical and non-physical threats such as directed energy, information operations, cyberspace, space, hypersonics, and autonomous systems.[2] Innovation does not naturally or linearly occur based on the advantages of financial support, manufacturing capacity, and materials alone, but through the development and selection of leaders that can foster an entrepreneurial culture that enables discovery and learning.    

Background: Sustaining versus Disruptive Technology 

            The most critical element for leading in the Great Power Competition will be the ability to innovate.  In the Innovator’s Dilemma, Clayton Christensen, a consultant to many of the leading technology companies in Silicon Valley, explains the concept of innovation as the difference between disruptive and sustaining technology.  Sustaining technologies “improve the performance of established products, along the dimensions of performance that mainstream customers in major markets have historically valued.”[3] Disruptive technologies generally start with lower product performance, but “bring to a market a very different value proposition than had been available previously”[4] and leads to the established firm’s demise.  Disruptive technologies initially “underperform established products in the mainstream markets,” but develop into an advantage that is “typically cheaper, simpler, smaller and frequently more convenient to use.”[5] Principally, a sustaining technology marks a marginal change on a current product while a disruptive change is a game changer that could be only attractive to a small market at first, but then blossoms into what Joseph Schumpeter similarly called a “creative-destructive” property that destroys the competition that would otherwise remain without investment.[6] Is it possible the JF could miss an innovation because it is focused on a legacy capability or mainstream vendor only to see an adversary deliver a creative-destructive blow?

Innovative Leader’s Attributes

            Many disruptive technologies have been discovered by an individual or small team of innovators with specific attributes that facilitated experimentation and risk-taking.  In The Innovator’s DNA by Jeff Dyer and Clayton Christensen, the authors surveyed over 5,000 chief executive officers from 75 different countries on leadership, stated “that the DNA of innovative organizations likely reflects the founder’s DNA.”[7] Dyer and Christensen concluded that innovative teams usually emulate their innovative founder’s skills and principles, that when working through their business’ problems, they discovered solutions and eventually adapted the process into the organizational culture.[8] Also, innovative leaders often recruited or worked with people similar to them, meaning innovative leaders want to work with other innovators to see their dreams come to fruition.  Lastly, not only did they encourage a philosophy that allowed “smart risks,” they inspired personal development and processes within their individual teams with these five main attributes:  questioning, associating, observing, networking, and experimenting.[9]

            Questioning begins the creative process and binds together the other innovator skills.[10]  Similar to problem framing in military planning, understanding the problem is critical to the beginning of the process to prevent a solution from not matching the problem the team was trying to solve.  Asking “why-not, what-if” questions help to define the environment and upset the status quo.[11]  Innovators understand that they do not always have a clear picture and by asking questions about customer needs, process controls, or others’ perceptions of the situation, they gain a better understanding of what is required. Toyota’s management included this in the Toyota Production System by requiring employees to ask why five times about every problem to appreciate the complexity of the problem and to draw out the root cause.[12] By considering the full scope of the problem, questioning allows an innovative leader to breakdown the situation and potentially discover new associations that have never been thought of before.

            An innovative leader that associates combines several skills such as vision and cross- pollination. The result connects disparate ideas that alone are only sustaining technologies, but when combined can create greater value together than on their own. The concept of association uses vision to connect and merge separate concepts or “disciplines to dish up new and unusual innovations and combinations.”[13]  Association also includes the skill of cross-pollinating, where a leader spreads or connects one idea with another within their organization and disseminates the solution across multiple teams or product groups.

            Innovative leaders use observation to gain experience from witnessing interactions in the intended environment.[14] Anthropologists in the field environment study culture, language, symbols, and customs; similarly for technology development, innovative leaders can watch users, processes, and tools in the actual environment they are intended to be used. However, this does not prevent an innovator from modifying the environment to see what changes occur in a different scenario or traveling to a foreign country.[15]  Innovators can also simply observe in their daily environment to cultivate new ideas without generating additional testing costs; for instance, talking with customers in a store while they shop both their technology and their competitors’ products to understand their interests in features, interfaces, and pricing.  Many innovators use their network to expand to entirely different environments and knowledge than they would normally be able to produce on their own.

            Networking can open innovative leaders to significant, low-cost opportunities for integration and association.  Networking is not only about gaining means, but the prospect to access “new ideas and insights by talking with people who have diverse ideas and perspectives.”[16] Innovators need to build an “idea network” which can provide a “bridge into a different area of knowledge by interacting with someone with whom...[a user] typically does not interact [with].”[17] Innovators should cast a wide net to include people from different competency areas, countries, ethnicities, and socio-economic groups. An innovator may be able to associate a new idea from an unrelated member of their network that faces a similar problem and has a valid solution. Symposiums, conferences, executive education programs at universities and industry conventions open the opportunity to hear outside ideas, but also increase an innovative leader’s “Rolodex” or contacts that he or she can call on later. Over time, after building deep, personal relationships, a private network can provide an innovative leader with a group or individual to bounce strategic ideas off of without the rest of the organization knowing which could prevent an overreaction by employees as they scramble to find solutions when the CEO is simply brainstorming. By passing their ideas through a network of confidants, the greater the chance for more effective experimentation.   

            Experimentation provides innovators with the ability to test new ideas before fully investing significant capital into a project.  Much like questioning, testing allows a creator to think about new concepts, but then take it one step further by assessing them from simple to different, challenging environments.  The results can then be applied to a problem at hand or change the business model.[18]  In The Innovator’s DNA, the authors “found that experimenting was the best differentiator of innovators versus non-innovators.”[19]  Their surveys of 5,000 CEOs resulted in non-innovators using experimentation-only 39 percent of the time while product and process innovators scored approximately 60-75 percent more likely to use testing.[20]  Dyer and Christensen found that innovators experiment in three ways:  by “tinkering” or taking things apart, trying new experiences and immersive environments, and testing prototypes or conducting pilot programs.[21]  Jeff Bezos, commenting on experimentation at Amazon, said “Experiments are key to innovation because they rarely turn out as you expect, and you learn so much…We’ve tried to reduce the cost of doing experiments so that we can do more of them.”[22]  Leaders that constantly adapt and are open to change is the key to staying ahead in the Great Power Competition, but it will also require an organizational culture that can accept constant change and thrive in that environment.

Organizational Culture & Values 

            When thinking about strategies, leadership, and innovation, it is important to define the term culture. When someone mentions culture, it takes on various meanings based on the situation. Many professionals in the field of organizational studies characterize culture by the values of an organization’s leader and defined through multiple iterations of their problem solving process.[23] Essentially, culture is forged through challenges to the team and the result of them working through the problem and developing their particular methods for discussions and decisions. It is also indicative of most leaders to recruit people like them, so it is not a stretch that the organization in total has the same or similar values and beliefs.

In their book, Diagnosing and Changing Organizational Culture, Kim Cameron and Robert Quinn refer to culture as the “taken-for-granted values” because of its almost omnipresent command of some organizations.[24] Culture may not be seen, but it is certainly present in the beliefs of the leaders and workforce.[25] Because culture is so much a part of the fabric of an organization, it forms the foundation of the way the leaders and employees will approach a problem and how the group will interact to find a solution.  While first and foremost it is crucial for the leader to be an innovator, it is even more critical that the entire workforce understands that change is constant in a competitive environment.  Cameron and Quinn devised a competing values framework that described the goals of different organizational cultures, but a more meaningful understanding of the framework is how the power of culture can lead to innovation by the entire team.

            To better understand an individual’s organizational culture, Cameron and Quinn designed a questionnaire that tallies a respondent’s score to describe their values and culture and the effects those perspectives have on processes and emphasis. Understanding the cultural type is the starting point for understanding the organization’s orientation, and then the leader can determine if a change is needed to meet a set of business goals and behaviors. Cameron and Quinn’s four major culture types are listed in Table 1 and are described in the below paragraphs.

Table 1. Competing Values Model (Cameron & Quinn)

            A hierarchical style is sought by organizations desiring rules and predictable and measurable processes. They also have centralized decision making, job specialization, standard operating procedures that dictate decisions, and strict accountability practices.  Due to size, the organization’s employees and leaders are covered in multiple layers slowing decision making processes down. Examples include fast food restaurants, large companies (eg: Ford), and government agencies (eg: US Federal departments including DOD).[26] Similar to hierarchy, market culture focuses on externalities, however, market based firms differ in that they seek aggressive attainment of goals through customer sales growth as an outcome.

            The market culture began to take form in the US during the late 1960s. At that time, foreign companies began to enter the US market having recovered from World War II, bringing greater competition to US companies in national and international markets. US Companies responded by focusing more on “productivity, results, and profits” to combat the new competition. They embraced an organizational culture focused entirely on achievements, “stretch goals” and “market share” and other forms of externally based measures.[27] Around this time, some companies did not follow the market convention and chose an alternate solution by becoming a clan culture.

            Clan culture differs from hierarchy and market values because it focuses internally on employee and team development.  The clan approach works through decentralized teams and incentives based on the success of the group. Individual employees, no matter their standing in the company or tenure, are encouraged to provide input. This style began in post-World War II Japan and was embraced by US and EU companies in the 1970s to 1980s.[28]  An example is the animation company Pixar, an organization that “places a premium on teamwork, participation, and consensus.”[29] The leadership of Pixar focuses less on long term contracts and more on developing individuals and building cohesive teams that want to work there and do not fear making mistakes.

            Lastly, the adhocracy culture developed as the economy began growing from a manufacturing base to one centered on services and information technology. Information technology companies began seeing the pace of technological change rapidly increasing with the introduction of new and more powerful products on a faster basis. Not only were the products landing at a faster rate, but were also experiencing a lower lifespan in the market.  This meant their ability to garner profits quickly diminished as followers entered the market right behind them and potentially with something better, drawing attention and sales away from the first to market companies. Adhocracy firms are characterized by an “Emphasis on individuality, risk taking, and [where] anticipating the future is high.”[30] As discussed above, those firms are generally situated in high innovation, creation based, and technologically driven fields such as internet services, social media, and digital arts; examples include IDEO, Facebook and Google. They value open communication, testing, and employee development, which they deem directly impacts their power to innovate. Interestingly enough, several government agencies practice as an adhocracy such as NASA, DARPA, and DIU. NASA similar to IDEO and other adhocracy organizations, generally task organize around a problem (ad hoc) and help each other as needed (citizenship behavior) without the obstacles to thought caused by strict, formal organizational charts, and assigned roles and responsibilities.[31] NASA and DARPA, both being government organizations, do not practice the typical hierarchy style of the rest of the US Government which is generally rule driven and structured along stove-piped staff lines. They task organize as needed and practice open communication which allows for the free-flow of ideas across scientific specialties to solve complex problems. This has resulted in several disruptive innovations with space operations, global positioning, and the internet. It was their culture and organizational framework, built to emulate innovative commercial companies, that differentiated them from the rest of the US Government and enabled them to design those disruptive technologies.

Scenario Based Planning: Combining Innovative Skills and Organizational Design

            In his speech that introduced the new National Defense Strategy, then Secretary of Defense James Mattis stated, “Our competitive advantage has eroded in every domain of warfare.”[32] The 2016 US National Election, arguably the single most traumatic cyber event in the US to date, exposed the vulnerability of the nation to cyber espionage, propaganda, and cyber warfare from a peer competitor like Russia.[33] The Director of National Intelligence (DNI) assessment written in January 2017, described the election operation as the “new normal.”[34] Using a real world event as a backdrop and commercially available technology, below is a theoretical situation of a leader using innovator skills to solve a logistics information and security problem.

            To illustrate the use of innovator skills, imagine a hypothetical scenario in which the Chairman of the Joint Chiefs of Staff selects an innovative leader with discovering a technology to store, analyze, and protect JF supply chain information. The product would allow visibility and input from prime and sub-vendors’ part stock levels to enhance the readiness of fielded equipment. With minimal guidance, the new innovative leader meets with his adhocracy cultured team to brainstorm about the problem and discusses some initial ideas. Knowing the team does not have all the answers, the leader and team reach out to their network consisting of cloud providers, cryptocurrency programmers, modders, and CEOs spanning from Silicon Valley to Tallinn, Estonia. To collect JF logistician user stories, the team attended a US Indo-Pacific Command J4 Logistics conference and, by chance, connected with several officers from South Korea who were exploring different ways to store, transfer, and secure information during the next WESTPAC Exercise. The team was able to associate some of the ideas from a Garage 48 Hackathon in Tallinn with data from the South Korean Navy test reports. Due to the magnitude of the data and the global dispersion of the JF and vendor network, the team built a prototype platform using a secure cloud architecture to store information and an anti-tamper blockchain based distributed ledger for military and vendor input on part supply levels. Next, they fielded a minimum viable product to a Joint Task Force (JTF) and designed a pilot experiment in which a group of hackers the team met at DEF CON performed the role of a red cell and conducted several different cyberattacks to test for vulnerabilities. The test results were then shared back with their network and information assurance steps were implemented to better secure the system. The pilot provided the team some time to add a machine learning capability for the thousands of parts, types of equipment, and large JF distribution and transportation network options; including traffic, weather, operations & exercise schedules, product life cycle, and military/vendor Internet of Things device data.[35] The integrated machine learning tool continuously evaluated different algorithms which allowed JTF logistics officers to optimize the delivery of parts to prevent Major End Item failures and readiness dips.[36] The team then presented the results to the Chairman who directed them to scale up the technology even further and partner with the Defense Logistics Agency (DLA) to expand the program.

              Table 2 is a graphical depiction pulling together the innovator skills and the non-traditional methods to reach for a technology that may have been overlooked without the flexibility of an adhocracy team.

Table 2. Innovator Skills Applied to Blockchain

Innovative Leader photo source:  UNC Flagler School

Artist:  www.theartstory.org; Political Scientist: Wikipedia.org; Technologist: Time Magazine; Programmer:  Wikipedia.org

Alternative Concepts and Framework

            Companies should organize themselves based on what will make them successful.  The four cultural types describe the different values and goals to achieve organizational effectiveness established by the organization’s leadership.  Adhocracy and clan cultures work for innovative firms like Google and IDEO and by some government agencies such as NASA and DARPA; organizations requiring agility in decision making and staying ahead of market or threat trends. The US Government, primarily a hierarchical organization, focuses its services on efficiency, scale, and standardization to provide cost effectiveness and prevent discrimination in output (eg: Social Security, legal proceedings, etc). This brings up several relevant questions to the dilemma of capturing innovation and consistency at the same time: How can hierarchical organizations like DOD and the JF driven by a primarily mechanistic culture discover and integrate advanced technologies?  Should the JF change entirely or create smaller, segregated innovation organizations?[37] By examining the four different types of organizational cultures, clan and adhocracy are the most likely to spark and sustain innovative ideas.

            A hierarchical organization is difficult to innovate and adapt to dynamic environmental changes, but provides the standardization that the US Government requires in some areas.  DOD and the JF are diverse organizations that consist of multiple cultures, values, and objectives. It is almost impossible to find one or even five descriptions that describe DOD/JF or any one of its single agencies, services, or combatant commands. Organizational leaders within DOD/JF should look at their goals and evaluate if their teams should transition to a culture that is better equipped for innovation or if standardization of services is a better fit. Cameron and Kim underlined that some organizations are a hybrid of clan and market, clan and adhocracy or hierarchical and market; where they take care of employee development and are also goal-oriented and accountable.[38] Many organizations partially consist of two different cultures that could even have opposing values, and that the most “effective organizations are able to behave in flexible and sometimes contradictory ways. They can encourage hard-driving productivity and accomplishment, yet also empower employees and maintain a fun, informal climate.”[39] DOD/JF should ensure that organizations with the mission of discovering technology fit the clan, ad hoc, and market cultures and handpick leaders that can encourage those behaviors.

Synthesis & Recommendation

            All of the US national strategies described the nature of the Great Power Competition and the use of innovation as an aspect of the primary strategy. Since portions of the DOD and JF require decision agility and risk taking, while other parts require procedural standardization and strict accountability, leaders should assess their organizations and adapt as necessary to attain those objectives. If organizations are required to be innovative and remain hierarchical, it will limit customization, creativity, and experimentation. The size and layers of hierarchical organizations slow discovery and force compromise as decisions move from one level to another, thereby reducing the solution’s ability to answer the problem.[40]

            Innovative organizations in the JF need to carefully select their leaders. Marc Andreessen, a Silicon Valley venture capitalist and innovative leader wrote, “It’s the oldest rule of disruption:  People inside the company almost always see the next big thing coming, but have a hard time being heard or driving actual change.”[41] Since a leader’s values and decision making processes define the culture of the organization, it is critical to access leaders that possess innovator skills and that can encourage those attributes in the workforce. Those skills include questioning, associating, observing, networking, and experimenting; all of which combine to frame the question, use a wide network to collaborate, and observe and test to find a solution.

Conclusion

            The US is receding advantage in all domains and regions and cannot afford to remain stationary as threats and technology converge. Faced with a Great Power Competition and growing pressure, the US must look to various, non-traditional means to innovate; a problem that can only be solved by innovative leaders.  The JF needs to carefully select innovative leaders, and those people may not be the traditional fighter-leader from the battlefield, but ones that can question, associate, observe, network, and experiment. Their questioning, tinkering and experimentation nature makes them open to new ideas, experiences, and thoughts. Innovative leaders that know how to find similar talent, design iterative processes, and can build organizations that allow the free flow of communication and ideas are the primary enablers to drive the US past its challengers. The JF, DOD agencies and services must value those innovative traits and conscientiously select, promote, and vector those leaders to critical innovation positions. Specific DOD organizations need to have the culture, values and processes that encourage the discovery of innovative ideas; where questioning and failure are accepted if not rewarded. It may be an unsuspecting discovery, found by an innovative leader and team, that unlocks the next disruptive technology and creates a game changing creative-destructive advantage for the US over its adversaries.