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20/09/2017

Essential advice for creating a company culture of innovation

Clockwise from bottom centre: Martin Loat (founder Propeller), Phillip Luff (Scripps Networks Interactive), Stephen Martincic (Ascential), Jane Sparrow (The Culture Builders), James Wildman (Hearst Magazines UK), Anna Carpen (18 Feet & Rising), Darren Childs (UKTV), Roslyn Shaw (Alpha Grid), James Goldhill (Transform UK), Matt Phillips (Propeller), Alan Sullivan (JCDecaux), Toby Morris (Northern & Shell) and Claire Hungate (Brave Bison)

High-performing businesses should act like sports teams, not families – this was one of the key insights offered by UKTV CEO Darren Childs at Propeller’s latest networking dinner.

The media company is currently enjoying double-digit growth and Childs provided an overview of how to create and nurture a sustainable, engaged and innovative company culture to underpin business growth for an audience of senior media and ad industry executives at the event, held at Cinnamon Bazaar, London.

He pointed out that an engaged workforce gives a company a strong competitive advantage and added: “But that process of creating an engaged workforce has no end, it’s a constant focus from the top to build a working environment where everybody is doing the best work in their career.”

Childs’ five key management tips:

  • Act like a sports team, not a family. Offer mutual support but do not carry those who don’t perform, a ‘no heroes, no passengers’ approach builds strong teams and allow teams to celebrate success together. “Families blindly support poor performance: business can’t be like that when performance matters.”
  • Inspire and coach to increase employee engagement. “Don’t direct or dictate but instead coach. We have set up six-weekly cycles to review progress against an agreed set of goal for the year. We are not going to micromanage how people get things done, just agree a destination, and then support them to get to that destination.”
  • Make sure company values are demonstrated every day by management “otherwise don't expect everybody else to follow them. Measure your own performance against them.”
  • Pursue “active de-learning” - unlearn old fashioned practices that were taught in a very different world to the one in which businesses now operate. “Command and Control is dead, it’s a structure designed for the Industrial Revolution, not the creative digital revolution. Replace it with a high engagement model – and constantly check that our processes and principles will deliver the desired outcomes.”
  • Encourage communication by kicking down physical and hierarchical barriers so everybody is accessible to share ideas. “At UKTV everyone is seated in open plan. Everyone has a desk, but we all move around every three months to break department silos and form long term collegiate relationships across functions. Most break-through ideas come from serendipitous interaction, so do everything you can to remove friction around sharing ideas.”
The good, the bad and the ugly – successful and unsuccessful company cultures

Propeller guests shared some examples before the evening discussion of companies they felt exhibited a well-developed culture of workplace engagement and innovation - and ones that had failed.

Alan Sullivan, Managing Director of JCDecaux Airport UK and Claire Hungate, CEO of Brave Bison, pointed to Lego as a business that has harnessed innovation within a framework that identified the ideas most likely to succeed with the customer base. Sullivan said: “The role of management is crucial in nurturing innovation as well as having the vision to see how it can be transformed into commercial success.” Hungate added that Lego concentrated on where it was strongest and could add value.

Given Lego has just reported poor results and blaming an overly-complex business structure, maybe it has not been following these mantras of late and needs to review its culture to get back on track.

James Goldhill, Director of Transform, highlighted Google with its well-known ‘20% time’ practice that gave employees free time to innovate and led to products like Gmail. His key take-away was that trusting employees means companies can tap into their people but this must come with hard financial support - 20% of time/salary was allocated by Google to the practice. The company dropped the exercise in 2013 for a sharper focus on innovation – an illustration of how practices must be constantly reviewed and not become fossilised as a company grows.

Toby Morris, Commercial Director at Northern & Shell, applauded H&M’s Arket retail brand for its approach in forming teams with different expertise (management, creative, design, marketing etc) when innovating for new audiences; he also applauded the agency Anomaly for a culture that views a problem not as an advertising issue “but more broadly as a business issue.”

Nelius De Groot, CEO at mobile advertising data specialist Mporium, highlighted high-end audio system maker Naim as a company with a culture of innovation focused on the core customer proposition.

Companies with a flawed approach to culture included Nokia - a business that failed, says Sullivan, due to “focusing time, money and resource on innovation in the wrong part of the business”.

Goldhill felt that many companies in insurance, from AXA to Zurich, have failed to innovate due to a risk-averse management environment, while De Groot pointed to a similar malaise in the Investment Banking Sales and Trading sector. He said: “The reality is that the politics and business environment of a bank is not fertile ground for delivering innovative financial technology, unlike FinTech where the culture inevitably embraces rather than fears disruption.”

Morris added that British Airways is a company in danger of falling behind because it is not innovating or listening to its customers.

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