Many companies have overriding values such as innovation, customer focus, safety or risk management. However, despite these well-publicized goals it is often uncomfortable and unlikely that rank and file employees take the initiative to further these beyond a very prescribed way due to fear of rebuke or retribution.
- In an extreme example, in the Deep Horizon oil disaster, there have been reports that although various employees were empowered to signal an evacuation alarm none did for a significant period of time, all citing that despite written policy in support of using the alarm, in practice use of it was frowned upon as false alarms disrupted the crew and caused expensive delays.
- Less extreme, but perhaps more common, are company directives to ‘delight’ customers or to drive innovation at all levels. However, many employees are fearful of executing on these as they may negatively impact specific objectives upon which they are reviewed and which are used in determining their performance pay. For example, a clerk in a mobile phone store might be directed to ‘delight’ the customer – but will then be reviewed negatively if they provide discounts or other special requests in order to address service issues.
We would propose to test this through an experiment. Although the safety example is perhaps the most eye-catching, we believe that encouraging fresh thinking and innovation is a need that is more common across industries. As a first step, we would have corporate or divisional headquarters distribute the strong message that innovation is key and encourage employees to ‘try new things, challenge current processes, seek out new markets and products,’ both through publications and through town halls. Then we would identify a sample set of 10 managers within the same sub-division. Five of these managers would have their employees place ‘experiment with innovative ideas’ as an objective in the employee’s annual objective exercise, while the other five would not. At each quarterly review period, we would then see which group has put forth more innovative ideas, and of what quality. This would allow us to see if the objective creates quality or simply quantity. We would also interview the employees before and after to understand how comfortable they are presenting innovative ideas to their managers (on a scale of one to ten). We would expect that the employees in the group with innovation in their objectives to feel more comfortable presenting ideas than those without. On the long term, we would also expect a higher quantity and quality of innovative ideas to come out of the same team.
Ricardo Amaya, Alexey Danilov, Megan Gentilesco, Zaid Ghazaleh, Alistair Lindsay, Gianluca Massimi, Ileana Tovaglieri