Thought Leader: How daring is your business when it comes to innovation?

In cross-industry settings, we must integrate the perspectives and capabilities of participants, writes Amy C Edmondson, Novartis professor of leadership and management at Harvard Business School.

More and more organisations are participating in innovation projects where people collaborate across multiple organisations, industries, and even sectors.

But innovation is not a guaranteed outcome of such projects. In fact, even with the best of intentions, cross-industry innovation projects are more likely to fail than to succeed. Does that mean your organisation is best advised to steer clear of such initiatives? Of course not.

The potential upside makes the effort more than worthwhile, but success hinges on effective teaming across industries. Integrating the perspectives and capabilities of participants in diverse and virtual (geographically dispersed) teams is not easy. The technical and interpersonal hurdles are equally high.

Connecting dispersed teams 

My colleagues and I have conducted research on a handful of cross-industry innovation projects over the past seven years, most notably in studying two projects focused on building state of the art greenfield smart cities. One was remarkably successful, and more detail can be found in a Harvard Business School case study.  The other, more audacious and technologically driven, struggled to get off the ground.

The brainchild of two tech entrepreneurs and a diverse team of experts from real estate, construction, architecture, technology corporations and city government, the latter project is the subject of the in-depth case study of cross-industry collaboration that my co-author, Susan Reynolds, and I profiled in our new book Building the future: Big teaming for audacious innovation. 

Part of the innovation challenge lies in coping with the wide range of expertise cross-industry projects encompass. Participants live in very different intellectual worlds and speak different technical languages. Everyone knows and expects these technical differences. But differences in norms and values across industries are equally significant.

Most people take the culture within their profession for granted. Within an industry, people share assumptions about things such as what goals are important, how people at different levels should interact, expected time frames, quality standards and so forth. The culture of civil engineering, for example, is very different from that of software, though both fields are deeply technical.

Conflicting assumptions, usually unstated, lead to misunderstanding and stalled progress. In short, cross-industry teams suffer from culture clash. For people to innovate successfully, they need to understand each other’s expectations and skills.  This rarely happens spontaneously. In other words, it takes leadership.

The most successful projects in my experience share three leadership practices that help them overcome the technical and interpersonal barriers: 

1. Offer a compelling but adaptable vision.

Many writings on leadership imply that an unwavering vision is what motivates and inspires people to work hard and stay engaged. In cross-industry teaming, however, projects are complex and dynamic, and the vision must be expected to evolve. Plenty of aspects of the innovation are unclear at the outset, and the initial vision is necessarily wrong in important ways.

A dynamic vision provides room for participants to help shape it as the work unfolds. For leaders, this means managing a tension between clarity of purpose and shifting goals. Doing this well necessitates being clear about the project’s basic values while explaining, inviting input into, and celebrating the vision as it shifts.

2. Create psychologically safe spaces for sharing expertise and values across industry domains.

A great deal has been written about the importance of creating psychological safety to promote effective teams – particularly visibly in a New York Times article on research at Google.

But the challenge of teamwork intensifies in cross-industry projects. Part of the problem is that experts see their own expertise as obvious. It may not occur to them to explain their thinking –assuming others see and understand what they see and understand. Clashing cultural values like these often undermine cross-industry collaboration.

Project leaders must find ways to help diverse experts share goals, insights, knowledge, norms, values and more – in an ongoing way. These investments in cross-domain learning prevent problems that range from small delays to major project failures. 

Leaders can frame cultural differences as a source of strength, helping people find ways, for example, to achieve novelty and reliability simultaneously.  The tensions between fields point to areas for focused innovation efforts, which starts with gaining mutual understanding. 

3. Promote small experimental action

Because no audacious innovation project has a blueprint, leaders must promote small, fast, action to test and develop emerging ideas – a practice I call “execution-as-learning” that embraces an experimental mindset and method. This puts a premium on collaborative analysis of interim results as work unfolds.

When uncertainty is high, many, if not most, early experiments will end in failure. But these failures are rich in lessons. They are also, quite simply, unavoidable in any innovation process – and that much more so in cross-industry innovation projects.

And so, leaders must help people cope with the contradictory demands of envisioning an audacious future while engaging in small imperfect action in the present. Together the leadership practices highlighted here are useful in any kind of innovation project, but in cross-industry settings they are vital to success. Vital to building the future.