Don't Let Hierarchy Stifle Innovation

Published:

September 11, 2022

Length:

58:07

Available On

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Show Notes
Today Tim and Junior sit down to discuss Tim’s recent Harvard Business Review article titled “Don’t Let Hierarchy Stifle Innovation.” There are a lot of concepts that Tim wasn’t able to include in his article that are discussed today, including how to improve our interactions, how to unleash bottom-up innovation and the role that hierarchy plays in innovation and execution. 

You can read the HBR article here: https://hbr.org/2022/08/dont-let-hierarchy-stifle-innovation

About the article (1:30). Junior introduces the first line of the article as the theme of this podcast. Tim shares what motivated him to write the article in the first place. 

Innovation, hierarchy, and division one football (7:30). Tim shares an analogy from his college football days that explains how extra layers in a hierarchy makes things complicated.

Whose job is it anyway? (11:15) Tim claims that it’s the senior leadership’s responsibility. They have to enlist the rest of the organization, but innovation is embedded in every role. Do we teach our managers how to manage innovation? 

Interactions have an element of quality (15:25). Being at the top of this spectrum of quality means that fear, anxiety, inhibition don’t get in the way. Is it free-flowing? Energetic Candid? 

Sustainable competitive advantage (21:15). Tim and Junior discuss what innovation does for an organization and why it pays dividends in the long run. 

A culture of rewarded vulnerability (30:30). If participation rights aren’t enforced from day one and in the day-to-day, innovation and change won’t happen. You can’t fake the quality of interaction for more than a couple of hours. 

Innovation is unknown (37:00). This will usually cause some angst, a little bit of “I don’t know” and that discomfort is part of how you’ll know that you’re in exploratory inquiry. 

Normalizing constructive dissent (42:15). Tim and Junior break this down: what is dissent? And what do they mean by constructive?

How empathy regulates discovery (50:40). Empathy means “I will try to understand with compassion and curiosity how you arrived at your conclusions from these data.” Tim explains why empathy is crucial to the innovation process.
Episode Transcript

0:00:29.3 Junior: Welcome to this week's podcast, Culture by Design. Today, we have a very special guest. You'll notice that the voice at the beginning of this podcast is different from the one you normally hear. I'm Junior. I'm the head of product here at Leader Factor. And today I will be hosting today's podcast because our guest is your normal voice, the normal host, Dr. Timothy R. Clark. Tim, welcome to the podcast.

0:00:52.6 Tim: Thanks. Did we switch chairs? I guess we did.

0:00:55.5 Junior: We did. Welcome to your podcast. Is that what I should say? Welcome to your podcast. Thank you. I'm excited to be here. Thanks for inviting me.

0:01:03.0 Tim: Oh, you're very welcome.

0:01:05.0 Junior: Well, today we have a fascinating topic, one that I'm very excited about. We're going to be treating Tim's recent article that was published in Harvard Business Review, Don't Let Hierarchy Stifle Innovation. So this article got quite a bit of traction, quite a bit of engagement across a bunch of different platforms. It was on the home page of HBR for a couple of days. It was featured in LinkedIn News. A lot of really interesting shares and conversations about this particular topic. And I, for one, was definitely hooked by the title. That drew me in, and I was so pleased with what followed. It was a fantastic article. So first of all, thanks for writing that, Tim. And we're going to be talking about the premise of the article, some of the assumptions, and we're going to be talking about the article in a way that you can't inside the article, because this is a little bit longer form. You can't say everything that you could say or that you might want to say in an article.

0:02:10.4 Tim: Yeah, I think what did we get? We had like 1200 words or something. So we're constrained, and so now we're liberated. So I'm excited we can talk a lot more about this, go into more depth.

0:02:21.6 Junior: Yeah. One of the things that I find, and this is true of a lot of your writing, Tim, from my own perspective, is that you are very talented, skilled at synthesis and about trimming the fat. And what happens when you're good at that is that each sentence packs a punch. That has some liability to it, because you can very easily skim over things that are very, very important and require a lot of attention. And so the first thing I want to do, diving into the article, is talk about the first line. And in that first line, I'll read the first line and then ask you a few questions. The first line is, in the team sport of innovation, the quality of interaction between teammates regulates the speed of discovery. So if there's one line that encapsulates the entire article, it's that first sentence. And so before we dive into some of the assumptions in that first line, tell us why you wrote the article. Let's back up. Talk to me about the motivation.

0:03:26.3 Tim: The motivation is the persistent pattern that hierarchy gets in the way. Hierarchy is a stumbling block. Hierarchy is an obstacle. It gets in the way of innovation. The first line is the premise, the quality of interaction regulates the speed of discovery. But let's zoom out a little bit and give you a different framework, a bigger macro level framework. In organizations, we only do two things. We do execution and we do innovation. Execution means we deliver value today based on what? The current operating model, the strategy of the organization, the way the organization is set up, the resources, everything. We deliver value today, that's execution. Innovation is delivering value tomorrow, but how are we going to do that? We don't know. We got to figure that out. So we have execution, we have innovation. If you're a manager, if you're a leader in an organization, which one are you responsible for? The answer is yes. You're responsible for both. But the problem is that hierarchies were built for execution, not innovation. And that's something that you need to think about. Hierarchies were built for execution, not innovation. Let's go all the way back to the Roman Empire.

0:04:48.1 Tim: They could execute like crazy. Okay, innovation. So hierarchy is built on the principle, the vertical principle of organization. What are the benefits of that? Speed, execution, alignment, accountability. But there's a horizontal principle of organization. What are the benefits of the horizontal principle? Collaboration, flexibility, innovation. So innovation thrives based on the horizontal principle of organization. So why did I write this article? Let me come back. I know this is a long-winded answer. Because hierarchy inherently gets in the way of innovation. How does it do that? When there's hierarchy, humans develop an authority bias. Authority bias means that we value opinions from the top of the hierarchy, and we undervalue opinions from the bottom of the hierarchy. So we start to overvalue source instead of substance, not all the time, but often. And so it gets in the way. So I come back to the opening sentence. The quality of interaction regulates the speed of discovery. In organization after organization, I see hierarchy getting in the way of innovation because there's this exaggerated deference to the chain of command. And we have this authority bias, and we can't really get in there and debate issues on their merits the way we need to.

0:06:31.2 Junior: Would you say that the problem is exacerbated the more layers you have in a hierarchy? Yeah, yeah, because there's just more complexity.

0:06:43.8 Tim: There are more divisions. Now, again, we need the division of labor. We need clear roles and responsibilities to get our work done. But when it comes to innovation, we need to be agnostic about where ideas or suggestions or opinions or points of view come from. Who cares? Let me give you an example. So in college, I played Division I football. Division I football is, as an institution, is hierarchical, extremely rigidly hierarchical. So for four years, I'm playing. I have coaches. I have teammates. Do you know what the experience was? It was me being told what to do. Do you think in four years a coach asked my opinion? They don't ask your opinion about anything. They just tell you what to do. That is the deep socialization, and that is the coaching pattern. That's all about execution. Do you think that a player has the ability to increase his football IQ and actually contribute meaningfully in terms of strategy, in terms of innovation? Yes. Are we ever given the opportunity? No. Division I major college football is an anachronism. It's the Roman Empire. You are only told what to do. I lived that for several years.

0:08:14.3 Tim: That is the reality. For execution, that might work fine. But what if you are behind in a game and you have to make adjustments? Now the coaches, they tell you what to do. But do you think that you could give some input on that? Do you think that you're becoming familiar with schemes? You think you're becoming familiar with tendencies? Yes, you are. Could you contribute? Yes. But we don't do that. That's just a very small example. When you get into the workforce and organizations, do we need people? Do we need their input from the bottom, that local knowledge to circulate up from the bottom of the organization? Yes, we do. We desperately need it.

0:08:58.3 Junior: What's fascinating to me about this is that if that's true, that the more layers that you have in a hierarchy, the more liability you have, we don't give extra attention to this concept as we get bigger and as the hierarchy gets taller. That seems interesting to me. You would think that if it's so obvious a liability, that we would give it some attention. We don't seem to.

0:09:24.7 Tim: Yeah. We get more siloed. Often what happens is we become reactive. It becomes we get into trouble. Think about this. What do organizations do? The larger the organization, organizations reorg and reorg and reorg. It's eternal. What are they doing? They're going back and forth from centralization to decentralization because they're paying a price for the liabilities of centralization. Then they come back over here to decentralization. Then they start paying a price for decentralization. What have we tried to do to get the best of both worlds? We've created a matrixed organization. I think there are some benefits associated with that. Dual reporting responsibilities, trying to be more cross-functional, trying to encourage the lateral and the cross-functional and the divergent thinking and the multidisciplinary thinking that leads to synthesis, that leads to innovation. That's what we've tried to do. Isn't it funny how we chronically reorg? Don't you get a kick out of that? I do.

0:10:36.1 Junior: It's amazing. It seems that almost every organization I speak to of any substantial size is in reorg. That's right.

0:10:46.6 Tim: Half the time you're in reorg. Oh, hang on a second. We're reorg-ing right now. Okay.

0:10:52.4 Junior: So if we're talking about the quality of interaction, we're talking about the liability that comes with hierarchy, whose job is this? Who fixes this? Who takes responsibility for this?

0:11:05.8 Tim: Well, it's the senior leadership's responsibility ultimately. They're responsible for the overall execution and innovation of the organization. They have to enlist the rest of the organization. Now, technically, I believe that innovation is embedded in every role, but we don't teach people that way. We socialize people. We acculturate people to execute. So they develop very early on a tactical mindset and they become very task-oriented and they execute. Now, that's not a bad thing. It's just incomplete. Are they being taught to innovate when they first come into an organization as they're moving? No, not normally.

0:11:52.7 Junior: If anything, you're being told to not innovate. That's right. Don't rock the boat. No, don't do it because execution is about reducing variance.

0:12:04.2 Tim: Innovation is about introducing variance. Don't do that. Don't introduce variance because we need efficiency and we need to scale. And those things, they work against execution. But let's not talk about just the employees. Let's go back to the managers. Do the managers know how to manage innovation? No, most don't. They know how to manage execution. Do we teach our managers how to manage innovation? Most of the time, we do not. They are taught to manage execution. They don't know how to manage innovation. In some cases, they do, but that's the exception. So we're teaching leadership encompasses both companion disciplines, execution and innovation. But in most organizations, we only teach them half of their job. Isn't that ironic?

0:12:55.1 Junior: It is. So let's talk about innovation for a minute. The first assumption that you make in the first line, it's in the first four words, in the team sport, in the team sport of innovation. So you're assuming that innovation is a team sport. Tell me more about that.

0:13:11.3 Tim: Well, innovation is usually accomplished through what we call combination or recombination. That means we are combining things. We are connecting things. We are synthesizing things. It's like peanut butter and chocolate. They come together. It's a beautiful thing. I don't know who invented it, but I want to meet that person. So this is the nature of innovation. We come together. We connect. We share. We synthesize. Therefore, it becomes a team sport. You may be the world's foremost expert in your domain of expertise. Great. But an innovation will almost always spill over beyond the boundaries of what you know and can do. And so it becomes a collaborative enterprise. It becomes a team sport. You're not going to do it by yourself. There are times when someone has a light bulb moment of lone genius and they're in a corner all by themselves and it's Eureka. Okay, great. That's the exception.

0:14:19.9 Junior: And often there was a lot of recombination and collaboration that led to that anyway. And what I've found is that as you dissect those moments of lone genius, there are a lot of people behind that light bulb. And speaking of light bulbs, Thomas Edison is a fantastic example. I remember the first time I learned about his lab and the number of people and the amount of collaboration that went into some of these things. Because at the beginning I'm like, oh, phonograph, light bulb, it's just Thomas. No, no.

0:14:52.5 Tim: He's in there doing his thing, right? By himself?

0:14:55.6 Junior: Yeah, by himself, late at night. Not remotely.

0:15:00.5 Tim: That's not how it works. No, it's not. It's just not how it works. Very unusual. So it's a social process. Innovation almost always is a social process. That's why the quality of the interaction regulates the speed of discovery.

0:15:18.2 Junior: Okay. So second assumption, quality of interaction. You keep saying that. You're assuming that interactions have an element of quality. This may seem obvious, but do you believe that? That there's this spectrum of quality regarding interaction?

0:15:33.6 Tim: Yes. When I say quality, I mean they're unencumbered. They're not impeded with. So what are the things that get in the way? Fear, the anxiety, the inhibition, all these things that hierarchy can impose on that interaction, the quality of that interaction. If the boss pushes the fear button, what am I going to do? I might withdraw all together. I might retreat, but even if I do engage, I'm going to be very careful about doing it. It's going to be guarded. I'm going to filter, massively filter what I'm doing. I'm in the mode of surviving, self preservation. So yeah, quality of interaction. How free flowing? How energetic? How candid? Those are the criteria. Those are the factors that determine quality, I think.

0:16:37.3 Junior: So interactions have a quality element and that spectrum runs anywhere from very poor to excellent. The next thing that you mentioned is that the quality of interaction is between teammates. I find that word particularly interesting when we're on this topic. Teammates implies a whole bunch of things. It implies that we have the same goal. I think that's interesting. Teammates implies that we're on the same team. Again, it might seem basic, but the word teammate seems fairly intentional to me in that first sentence. So teammates, help me understand what you think when you hear teammate. Why did you use that word?

0:17:18.4 Tim: Because we're trying to take out power distance. We're trying to remove distinctions based on rank and status because that doesn't help.We're trying to innovate.

0:17:32.3 Junior: You would use that word regardless of who's in the hierarchy.

0:17:37.3 Tim: Yeah. Yeah. Teammates. Teammate. Yeah. Now, if you happen to be the boss, congratulations, but should we award you a special premium for your opinions because you're the boss? That's ridiculous, right? We're going to debate issues on their merits. As the boss, that's fantastic. You may have the decision-making power at the end of the day. That's great. But do we have participation rights here? So yeah, teammates implies that we are agnostic to title and position and authority. We're removing power distance that comes from rank and status, which gets in the way, gets in the way. It constantly gets in the way.

0:18:21.3 Junior: One of the things that struck me as I was reading the article is that a lot of these principles seem straightforward. It seems unlikely that anyone would disagree with them at face value. And yet we do what we do. And yet we do these things in organizations all the time that we probably shouldn't do and yet we do them. And we do them that way for a reason. There are reasons we do all of these things, and that's part of what I find so fascinating about this is we don't use teammates, or at least we don't treat each other that way in some sense, especially inside the hierarchy. We don't think of interactions as having a quality element, not day to day. We don't think of innovation as a team sport all the time. It's aligned around execution as you've said. So we could also say if you took the reverse of each of these assumptions, it would be the perfect way to kill your organization over a long enough time horizon. So let's think about that. Innovation as a team sport. We flip that. We say innovation as a solo sport. If you treat your organization that way, you're done over a long enough time horizon.

0:19:32.8 Junior: If you assume that interactions don't have a quality element, you're toast.

0:19:40.1 Tim: Or you say that innovation is a product of hierarchy, right?

0:19:42.6 Tim: Yeah. Well, so it could be isolation or you do it by yourself, an individual sport, not a team sport, or maybe it's in the context of a hierarchy. Good luck.

0:19:54.4 Junior: Good luck. And if you don't believe that you're really on the same team and that you don't have the same goal, good luck. Well, the last assumption I want to treat here is that the speed of discovery is important. So there's discovery and there's speed to discovery. You must think that this is important. Otherwise you wouldn't have said anything.

0:20:15.6 Tim: Yeah, that's right. Because competitive advantage by its very nature is perishable. It's not permanent. We don't know how long it's going to last, but we know it's melting. It's like a piece of ice. It's melting. The big question is what is the rate of the melt? Now the other thing we know is that in this very highly hyper competitive, very dynamic environment that we're working in today, the average span of competitive advantage is shorter. It's growing shorter. On average, it's shorter. And so then whatever the sources of your competitive advantage are today, they're melting. So ultimately then the source of your sustainable competitive advantage is what? It's your people and it's their ability to work together to innovate. So it comes back to people and the quality of their interaction.

0:21:11.0 Junior: One of the things that I think about as I hear you say that is that if you want any sort of predictable innovation, that it has to be part of a system and it has to be part of a system that incorporates these values. Otherwise, what has to be true? You're relying on lone genius. That's what you're relying on.

0:21:36.6 Tim: Or the people at the top of the hierarchy.

0:21:38.7 Junior: Right. But they're going to be pretty lonely up at the top.

0:21:41.0 Tim: Yeah. Well, here's what's going to happen. They will become willfully blind because they're not circulating local knowledge to the top of the organization. And so ultimately they will die of self-inflicted wounds. They will lose their adaptive capacity as an organization. And if you look at organizations that die, many big, wonderfully successful, at least at one point, companies, they die and they were filled with large numbers of highly intelligent people and they died. Why did they die? Because they couldn't do this. They got in their own way. That's what happened.

0:22:18.2 Junior: I love talking about this because we put the brands up there, the big ones that we know about, and we point the finger and we say, how in the world did you lose? You were a giant. You had 90% market share. You dominated this industry. And the decade later, gone. And we think, oh, well, you must not be very smart because it's obvious.

0:22:46.6 Tim: We can say, Junior, we can say, well, let's acknowledge path dependence. Precisely. That's the point. The concept from strategy that you make certain choices in the allocation of your resources and the way you're going to do things and you're going to forego certain choices in the future. Okay, that's fine. Precisely. But still, even with path dependence, you still should be able to create this adaptive capacity in the organization and keep it going. It doesn't doom your fate.

0:23:17.2 Junior: No. My point is that there are smart people in those organizations and that this is a difficult thing to do. It's a very difficult thing to do. So let's summarize to this point, and then I want to get into some of the practical suggestions that you make in the article because there's light at the end of the tunnel. There's some real practical things that we can do to help. So hierarchy, and correct me if I'm wrong in this summary, hierarchy stifles innovation. So in the title, that's its tendency.

0:23:49.0 Tim: Yeah, that's the inherent tendency.

0:23:51.1 Junior: Because, and the crux of the issue there is the quality of interaction. So hierarchy lessens the quality of interaction, or at least that is its tendency. Through authority bias. Through authority bias. So the greater the hierarchy, the more insulated the top of the hierarchy becomes from the local knowledge at the front, it doesn't get circulated. We lose our adaptive capacity. We become stale. We stagnate, stop moving and we die. Is that fair?

0:24:24.2 Tim: Yeah. That's the overall tendency and pattern.

0:24:26.6 Junior: So the goal then becomes to neutralize those tendencies and do things in a real practical sense that hedge against the downside risk, culturally, of the hierarchy. Exactly. So the first one that you mentioned is grant irrevocable participation rights. And you make this distinction between participation rights and decision rights. Why is that the first one? And help us understand the distinction.

0:24:54.8 Tim: Right. Participation rights means that you are given the right to participate, to register your opinions and your points of view and your suggestions and your ideas. Decision rights refers to the authority to make a decision. That's different. So we need to make the distinction clear so that we can then say grant irrevocable participation rights to everyone on day one. When they come into your organization, it should be part of their job. It should be inherent in their role to have participation rights and they're never taken away. Now, is there an expectation? Yes. To use your participation rights, you need to be respectful. You need to have some contextual understanding and you need to be able to show good faith as you're working with your colleagues. And that's a minimum requirement and that's reasonable. But those participation rights should not be taken away from you. We shouldn't grant them or withhold them or revoke them. They should be there, always there. Now, do organizations do this? Often they don't. Often they grant participation rights on the basis of seniority and time and grade. And if I like you and do we have a relationship and what's your position and do you have any positional power and all of these other criteria, those will simply get us into trouble.

0:26:36.5 Tim: Everybody needs participation rights.

0:26:39.2 Junior: What would you say to someone who might raise the argument, they don't understand the organization, they're ignorant, they don't have the contextual understanding necessary to say anything meaningful to me. So give them a year, let them marinate in the organization for a year and then maybe I'll listen to you. What would you say to that person?

0:26:58.7 Tim: There's a logic to that, but the downside is that they're not a prisoner to your paradigm. They have fresh eyes, they have fresh thinking, they're not constrained the way that you are. You need that. You need the fresh perspective. They are unencumbered by all of that baggage, all of the assumptions, all of the mindset, the culture that you have. It's a mighty fine line between ignorance and brilliance and you don't know where that line is. And so you need that naivete to register a point of view. Even when they don't have all of that institutional knowledge and background and experience, great, let's tee it up. Let's see what they have to say. Let's look at how they look at things. Because they're going to see where you're wrong, where you're flawed, what you're not thinking of. They're going to bring fresh perspective that you simply can't see. So they need their participation rights and you need them to exercise their participation rights so that they can keep you safe.

0:28:08.2 Junior: So as a leader, I have a new team member. They come in with some trepidation. They're a little timid because they've been socialized to believe don't come in guns blazing. Just come in, don't make too much noise, assimilate to the culture and maybe down the road you can speak up. You can raise your hand. Yeah. So as a leader, how do you help neutralize that tendency? How do you help people understand, no, really, I mean it. Tell me what you think.

0:28:42.1 Tim: I think it goes back to the expectations for the new person. Always respectful, demonstrating some contextual understanding, at least some, right? So that you have some kind of informed view, at least a little bit. And then number three, good faith. I think you continue to communicate and reinforce those expectations and say that your participation rights are based on those expectations. Please meet those expectations, but we want to hear from you. Now that's going to take constant reinforcement because people are so deeply socialized that when they come into an organization, oftentimes they're not going to say anything because they've been in other organizations where socio-culturally they were not given participation rights for a year or two or whatever it was, or based on their position or based on their relationship or based on other perhaps even arbitrary factors. They've been there. They've experienced that. So they come in and they're skittish. They're gun shy. They're not going to jump in. And for good reason, they have a data set that says, don't jump in. You're going to earn your stripes and it's going to take a while.

0:30:06.8 Junior: It's interesting to me that if that's not reinforced constantly in the team before that new person comes along, they'll come in day two, day three, they'll start looking around. I don't see anyone else raising their hand. I don't see anyone else asking a penetrating question. And so it's important that it seems to me through that onboarding experience, but in the day to day, what is the natural tendency of the leader? What type of environment does that leader create? And how do the people interact with each other on a day to day? At the end of the day, you can't fake that. You can say whatever you want at the beginning, but if that's not truly the expectation and truly the way that people behave, they'll see through that in just a few short hours. So you're raising a great point. The first part is the invitation. It's the invitation to use your participation rights and it's the explanation that you have them and here's how you should use them. But to your point, Junior, on the backside is the employee has to see evidence that that behavior is rewarded. That vulnerable behavior is rewarded. So if I register a point of view, if I jump into a discussion, if I float an idea, if I engage in divergent thinking, if I get clobbered for that, I'm out.

0:31:35.9 Tim: The other point that you're making, which is so true, is that that vulnerable behavior must be rewarded on the backside. I got an invitation on the front side. Okay. I went for it. I used my participation rights. If those are rewarded, then I'm going to look around and I'm going to say, I think this is real. And if I see others and they're rewarded for that vulnerable behavior and I keep seeing that pattern, then I'm going to say, this seems to be a prevailing norm on this team. This may be real. Let me try it again. If you get punished for it or if it's inconsistent, then you're going to back off and you're going to change your behavior because now it's about managing personal risk.

0:32:25.7 Junior: So that's the first one. Grant irrevocable participation rights. Thanks for diving into that a little bit. So number two, we have practice exploratory inquiry. And there's a distinction that you make at the beginning between exploratory and explanatory inquiry. What's the difference?

0:32:44.2 Tim: Explanatory inquiry goes with execution. Explanatory inquiry means what's happening, why are we performing the way we're performing, how do we explain cause and effect relationships? That's explanatory inquiry. We're using data. We're using quantitative data. We're using qualitative data. We're using anecdotal data, whatever the data is. It may be good. It may be not so good, but we're trying to understand why we're doing what we're doing, why we're performing the way we're performing. That's explanatory inquiry. Exploratory inquiry is connected not to execution, but to innovation. Exploratory inquiry is about what could we do? What should we do? How much data do we have about the future? Zero. We have no data. So we take the current data that we have, which is historical in nature, and we make assumptions. We make predictions. We extrapolate. This is the nature of exploratory inquiry. So to encourage this is to use what we call the disruptive question sequence. There's three parts to it. The first part is why do we do this or why are we doing it this way? So it always begins with a why question. So we are calling into question something that we do or a way that we do something or maybe something that we don't do.

0:34:14.6 Tim: So it always begins with why. So why do we do this? Why do we not do this? Why do we do it this way? Why are we not doing it this way? Second part of the sequence is what if? Well, what if we did this? Well, what if we tried this? How much data do we have about a what if question? We don't have any, but we're exploring. This is experimental in nature. So we float those questions, what if? And we can ask all kinds of what if questions. And then the third part is, okay, well then how would we do that what if if we were to try that what if? How would we do it? So how? So why, step one. Step two, what if? Step three, how? This becomes a discipline. This becomes a pattern. This becomes a habit. This becomes something that we model and we encourage on the team. And when we do this, lo and behold, what are we doing? We are leading innovation. So explanatory inquiry, execution. Exploratory inquiry, innovation. Lo and behold, we're leading innovation. A lot of people don't know how to do this. A lot of managers don't know how to do this.

0:35:27.6 Tim: They've never been taught how to do this. So this gives us a very simple and yet reliable discipline for doing leading innovation.

0:35:40.0 Junior: You sent out a video recently. It was a Roger Martin video about strategy and planning. And there were a couple of things I pulled from that that seemed really very relevant here. And he talked about planning as safe. I'm dealing with known resources and I'm dealing with cost structure. I'm dealing with what you're saying, execution. Or known targets. Known targets. Yeah. Exploratory, strategy, disruption. Those aren't comforting terms, right? That's because you're not on the map.

0:36:22.2 Junior: You're not on the map. And he said. It's uncharted. It's completely uncharted. And he said, part of when you'll know that you're doing strategy is when there's a feeling of angst. That's right. I love that. You cross over. Yeah, I think the same is true for these three questions. Because these aren't things that are 100% known. If you have to field a why question or you ask a why question, there's probably going to be some angst, a little bit of uneasiness, a little bit of uncertainty. What if? I mean, the premise of that question is I don't know. That's why I'm asking. What if? How? Not sure. That's why I'm asking. And so that parallel is interesting to me that there's some discomfort with these questions. And that's part of the reason or how you'll know that you're in exploratory inquiry or you're in disruption or you're in strategy. It's interesting to me.

0:37:29.1 Tim: Yeah. So go back to the first step, the why part, right? The why question is always the first question. It's the catalyst. It catalyzes the exploratory inquiry process. So whenever anyone asks a why question, does that create comfort? Does that create reassurance? Does that create? No, it does just the opposite. It is disruptive by nature and there's an emotional reaction, but it does create uncertainty. It does create ambiguity. It does create additional questions. A why question is a disrupter by its very nature. So yes, Junior, the angst is introduced.

0:38:12.7 Junior: So what do you do? I look at these questions and as a leader, I might say, I don't have time for that. If a why question, I don't know where that's going to go. I don't know where the what if question is going to go. I don't know where the how's going to go. And it may lead to a discussion that I'm not prepared to have. I don't have all the answers. There are important things that we need to take care of. So you can see why people would lean toward execution. So as a leader, how do you overcome that friction to get into this phase of asking exploratory questions and doing real exploration? Because you have goals, you execute for a reason.

0:38:56.5 Tim: Well you got to build it in. And what do most people say, hey, I don't have time for that. I got to run. I have a business to run. Thank you very much. I have a business to run. And I understand that, but you've got to incorporate innovation into what you do because your job is execution and innovation. And so you've got to set some time aside. You've got to structure it. You've got to put it into the schedule. Otherwise if you don't, then when do you expect people to do innovation? Is it all ad hoc? Is it all haphazard? Is it all one-off? Yes. There's no other choice. You're leaving people no other choice. Or maybe we just don't do it at all and we're running a breakdown maintenance system, break fix. We wait until, or the gradual erosion of competitive advantage, which is happening anyway. It comes back to the fundamental question. Are we going to do innovation deliberately, intentionally? We're going to build it in? Yes, execution consumes most of our time, but if we don't build in some time for innovation, we're going to pay a price. Sooner or later.

0:40:12.0 Junior: Sooner or later, you won't have a business to run.

0:40:17.5 Tim: That's right. The amortization schedule is on your business and the ice is melting and you are losing your competitive advantage. Little by little, we all are. So what do you want to do?

0:40:32.5 Junior: I think we have to acknowledge just how difficult it is to make space for that sometimes. It is. Because it's nice to share these principles, these tools. I think we would be remiss to not acknowledge it's difficult to make space for it. And that's why people don't do it. There's a reason why things are the way they are.

0:40:53.7 Tim: Execution is a vortex that sucks you in and it's so powerful. And unless you are very deliberate in saying we're going to make some space and room for this, it's going to close in around you. I agree with you. We have to acknowledge how hard it is.

0:41:13.3 Junior: So it's safe to say that it won't happen by itself, the exploration.

0:41:16.8 Tim: I don't think so. I don't think it's self-executes. No, the innovation.

0:41:21.9 Junior: It must be true then that you have to approach it with some real energy, some real attention. I love the word deliberate that you use frequently about the way that we need to do these things. If it's not deliberate, in all likelihood, it's not going to happen and will lead to your eventual demise. The lack of a business to run. Okay. So practice exploratory inquiry with those three questions. The last one, normalize constructive dissent. This may be my favorite. Normalize constructive dissent. So dissent, let's break this down. What is dissent? Dissent is challenging the status quo. And what's constructive dissent?

0:42:07.8 Tim: Doing it with the right motive, with the right intent to try to make things better. So I often point out the difference. What's the difference between an agitator and an innovator? It's the intent behind the dissent. Again, if it's good faith, if you're trying to make things better, then that's constructive dissent. And you need that. It's not a matter of just tolerating constructive dissent. You need to welcome it, encourage it, and reward it. It's vital. That dissent is your raw material for innovation. An echo chamber is your enemy. You don't need an echo chamber. What's that going to do?

0:42:50.4 Tim: It would make me comfortable. I want that. That's going to stroke your ego. That's great. But the homogenization of thought is the enemy. You don't need that. You need people that are helping you by challenging you. That's how they help, but with good faith and respect and contextual understanding. So let's go at it. Normalize. We want to normalize. What's normalize? Normalize means that we do it on a regular basis. It becomes accepted. It becomes a norm. It becomes a pattern of behavior on the team. That's what we need.

0:43:30.7 Junior: So think about that. Normalize constructive dissent is three words. Very easy to gloss over. There's a lot inside those three words. I really like that distinction between agitator and innovator. Intent. That's great. One of the suggestions that you have is criticize your own ideas and decisions in public. Now why would I ever want to do that? I'm a competent person. I want people to understand that I'm skilled. I should be here. I make good choices. Why would I ever poke a hole in that?

0:44:04.4 Tim: If you subscribe to the imperial model of leadership, you're not going to do this because you're the Oracle. You're the repository of the answers. So the last thing you're going to do is demonstrate that kind of vulnerability in front of others. But may I suggest that you live in the wrong century. So this is not the industrial revolution. In the 2020s, you need an inclusive model of leadership, not an imperial model of leadership. So that means you're going to lead by modeling your own vulnerability because what does that do? It draws people into that process. That's the moment of truth when you can take issue with your own decisions in public. That's amazing. What are you communicating to the rest of the team when you do that? You're communicating to the team that, well, there's humility, there's a lack of pride of authorship. You're letting go of these things and you're encouraging others and you're inviting them and you're trying to give them confirming evidence that if they challenge the status quo, they're going to be rewarded, not punished for doing it. They need that reassurance. So if you're willing to address your own decisions and things that you've done, we all make mistakes, but we don't always acknowledge the fact that we all make mistakes.

0:45:42.7 Tim: So when you finally do that, it's just simply refreshing to the rest of us that we finally recognize that you recognize that you're a mere mortal. Thank you so much for doing that in front of all of us. We already knew that, but it's nice that you could acknowledge that. And now you can lead the process with credibility. Have you ever had to do this? Yeah, because I make a lot of mistakes.

0:46:05.5 Junior: What's it like for you?

0:46:07.2 Tim: It's not always easy. It's not always comfortable. But when I do, the members of the team, I think they say, oh, okay, well then I'm going to jump in. When I do that, I think what it's saying to everybody else is you have a license to disagree and you are able to use that license, please use that license. And if you do, you'll be rewarded. I think that's what happens. I think it sends an unequivocal message to the team that this is how we're going to work together.

0:46:42.1 Junior: Yeah. You're not going to bat a thousand. No, no, you're not.Probably not close to a thousand.

0:46:52.3 S1: Yeah. I like that a lot. It's the nature of business. It's the nature of leadership. But guess what? Your batting average is going to go up if you enlist the help of every member of your team.

0:47:00.0 Junior: There you go. I believe that. I believe that's true.

0:47:02.8 Tim: You're going to unleash the power of that team, the collective intelligence, the intellectual horsepower, the commitment of the team.

0:47:13.7 Junior: And if you do that, a lot of these decisions become communal decisions and you're distributing that accountability as well. Now, there will be times, right, that you'll make a decision, it's on you. But if you distribute that, I think you have a lot of insurance. You have a lot of heads, right, thinking about an issue.

0:47:33.4 Tim: I think so. Now, let's not go too far though. Let's not misunderstand. We're not suggesting that we're all going to a consensus decision-making model. That's not what we're saying. Ooh, talk about that. Yeah. There are three kinds of decision-making models in organizations. One is unilateral. That means I'm going to make the call and regardless, I'm not even going to solicit feedback. I'm just going to make the call. I'm going to fly solo. Extremely dangerous. Don't ever use that model. At the opposite end of the spectrum is the consensus model where everyone has a vote. Also a disaster in almost every setting, except maybe a few. Why? Because it is painstakingly slow, inefficient. It goes on forever, right? We can't afford that in most cases. In the middle is a consultative decision-making model where everyone uses their participation rights, but an individual or a subset of the team has the decision-making authority and that is clear. That's where 99% of business decisions are made based on that model. That's appropriate. That is as it should be, but that needs to be clarified.

0:48:53.7 Junior: I appreciate that clarification because the 1% exists and we need to make space for that. There are times of emergency and there are times where you can't get something wrong, right? Or you want to hedge against that as much as possible. You're walking through a one-way door and you want as much information as you can get. I appreciate that. The second thing that you say is inject empathy. Why is empathy part of this process of normalizing constructive dissent?

0:49:24.8 Tim: Here's the way I define it. I define it this way in the article. Empathy means that you approach another person with compassionate curiosity, not just in general, but to understand how that person went from data to conclusions. We all have to take data and then we draw conclusions and we come to an opinion or a point of view. How did you get there? What's fascinating is that humans can take the same data set and come to different conclusions. We do it all the time, right, Junior? You and I are looking at some data and you come to this conclusion and I come to a different conclusion, but we had the same data. This happens all the time. You can't impute impure motive based on the fact we came to different conclusions based on the data set. What we need is empathy means that I will try to understand with compassionate curiosity how you arrived at your conclusions from these data. I need to understand your journey. How did you go from your analysis of the data to your conclusion or conclusions? If I understand that, then it helps me understand even more. It sheds more light on how I got to my conclusions.

0:50:55.8 Tim: I can see the differences. What happens as a result of all of this? Our critical thinking skills go to the next level. We are better at analysis. We are better at decision making. Empathy is not just some nice soft skill or emotion. It is critical for decision making and critical thinking.

0:51:20.3 Junior: You told me a few days ago something that hit me like a ton of bricks. I've never considered this. You told me the opposite of empathy is projection. What is projection and why is that so dangerous?

0:51:32.7 Tim: Projection is just imposing my view and also assuming that you have come to the same conclusions that I have and that your logic was the same. When we make a decision, it's based on two things, a logic structure and data. If I project, then I'm assuming, I'm projecting my thinking, my logic structure, my assumptions, my conclusions on others. They think the way I do. I do that. Very dangerous. Projection is very dangerous. As we become perhaps more skilled, more experienced, more intelligent, there's a tendency to move that direction because we think we know the answer. We think we're pretty good at what we do and we may be. That's okay. We have to be very careful not to project because that's when we develop the very dangerous blind spots. If we want our people to help keep us safe, then we try to avoid projection. We try to lead with inquiry, not so much advocacy, but more with questions rather than answers and statements. We try to resist the temptation to fall into dogma, which the status quo we can do so easily. We become dogmatic.

0:52:56.3 Junior: It's one of the things that I've found myself doing. Those two words are particularly striking, advocacy and projection. Our perception of the problem as individuals can be very different than someone else's perception of the problem. You're trying to solve the same issue. You're coming at it from different angles. You have different goals. Every experience you've had prior to trying to solve that problem together has been different. No wonder. No wonder. No wonder. That's the whole point and the beauty in approaching that with empathy is you know something I don't inevitably. It will probably help us solve this problem. If we both come to the table with that paradigm, we're going to come up with a better solution to most things.

0:53:48.2 Junior: I think so. You do that again and again and again and again. The team starts to do that together. What a beautiful thing that can be.

0:53:56.0 Tim: If you don't do that, then you have diversity that's been unactivated on your team. It lies fallow. You haven't activated your diversity. If you haven't activated your diversity, then you can't harvest the fruit of that diversity and all of the richness that's there to take you to better solutions, breakthroughs, innovation.

0:54:22.9 Junior: I love the way you put that. Let's wrap up. The first line of the article, in the team sport of innovation, the quality of interaction between teammates regulates the speed of discovery. That's what we've talked about today. That's what it sounds like you're passionate about, Tim.

0:54:41.1 Tim: Extremely passionate about, but I also know and acknowledge it's not easy, but it's worth the journey. It's worth the effort. Yeah, it really is.

0:54:51.8 Junior: So to all of our listeners, as you approach even the rest of today, let's not even talk about next week, today, three things. Grant irrevocable participation rights, practice exploratory inquiry, and normalize constructive descent. I'm convinced that if we do those three things, the quality of interaction will go way up. If we can institute these types of norms into our teams, our organizations, we will perform at a very high level and we'll enjoy doing it. That's one of the things that I found through putting into practice a few of these principles. It's an enjoyable experience. You appreciate the humanity of other people. You appreciate the differences and you generate better outcomes. It's all around better. And so from a personal level, one of the things that I would mention is when you feel that friction, I don't have time. I have a business to run. It's too difficult. It's too exposing. It's too vulnerable. Put some energy in, take that extra step that you normally may not, and do those three things. I know you'll have a better outcome. I've seen it time and time again. So Dr. Clark, anything else you'd like to share with us before we sign off on today's podcast?

0:56:13.5 Tim: I would just say, go back and think about the way you were trained in execution and innovation. Chances are that you haven't spent a lot of time on the innovation side of the ledger. And so I would encourage you to invest on that side. That's the companion discipline to execution and your investment will pay big dividends. So that would be my word of encouragement to all of you.

0:56:40.7 Junior: We'll leave it at that. If you liked today's episode, if you got value from today's episode, please subscribe if you haven't already. We'll be doing these podcasts in the future to explore all of the in-between the lines that we can't in just the articles. So Dr. Clark, thank you for your time today. Listeners, thank you for your attention. We appreciate the fact that you'd spend time with us today.

0:57:08.0 Junior: Best wishes, everyone. Have a wonderful day and we'll see you next time. Thanks, Junior.

0:57:20.3 Tim: Thanks for joining me today on the Culture by Design podcast. Be sure to subscribe and listen to new episodes every week. And if you'd like to see more of the work we're doing, go to leaderfactor.com.

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