I know, I know. Agile teams are supposed to be, by definition, these microcosms of self-organization, collaboration and creativity. And I've seen some that are. Some. Most, however, either don't learn how to become self-managing or self-organizing and take all of their orders - including technical 'how' orders - from product management. There are a myriad of reasons for this, and most boil down to lack of management support or lack of team knowledge of 'how to' become innovative. Lee Devin and I collaborated on the following excerpt from what was supposed to become a published magazine article; however, I don't think it's going to make it in glossy print, so here goes as a blog. We'll eventually make this available as a whitepaper.

Part 1: What Management Can Do So That Teams Stay Innovative

We define innovation as a valuable new product, service, or idea, that results from the creative process of collaboration. Sometimes we see an innovation in the foreground: an agile backlog created out of a new idea; the backlog encapsulates steps that will realize the innovation, make it come to life. A new thing - an innovation - must create value if we’re going to invest in it; however, for a myriad reasons which we’ll explore, many good ideas don’t get to the table.  And another thing, how do we know something is an innovation until we see it? So doesn’t that entail investment in the exploration of the idea?

An innovation does more than improve something we already have or know about. An innovation breaks with the past, takes us into new territory. Polaroid cameras, an improvement in photography, sped up the chemistry that developed images on film. Digital cameras, an innovation, ignore chemistry to manipulate information.

Value, in general terms, means we can sell something for more than it costs to make it. Businesses have on hand marketing and sales positioning staffs who use past experience to determine the potential value of an idea. They consider the known knowns, so to speak. But what if the thing is truly new, a genuine innovation? Well, then we’re in the soup. If an outcome is truly new, the market can’t yet value it very well, so the marketing department certainly cannot; customers have a hard time knowing in advance that they’ll like something they haven’t yet seen. Accommodating to this new reality takes a huge conceptual leap that changes everything, from the way you do your work to the expectations you have for its outcomes. Often these really, truly new business-transforming ideas are discredited as weird, rejected as not within current portfolio budgets or strategic plans, or, worst case, ignored altogether.

The mystery of an innovation’s value also means that our traditional ways of making a thing, service, or idea need rethinking; additionally, we need to rethink our reactions to and acceptance of the new idea. Making something new will require new ways of making, new attitudes toward making, and new methods of managing makers. Beyond that we can say only two things for sure. First, if we truly collaborate, we will make something new. Secondly, we can’t immediately tell if the new thing will have value right away, in the future, or ever. So we need to have an organizational stage that can accept the ambiguities of creativity.

To innovate effectively we need to learn how to create and operate in a new environment: let’s call it a Creative Culture. To help us think about such a culture, we propose a set of considerations for the management and leadership to think creatively and to respond productively to the creative thinking of each other. The first step to realizing innovations is to accept that there is no such thing as failure in an innovative process. The only failure is not being receptive to new ideas. 

How Management Can Set the Stage for a Creative Culture

Management can help innovations bubble up to the top by seeking, identifying, and budgeting for them. Here are some opportunities within an agile framework that management can leverage in order to set the Creative stage.
 
•    Organizational ‘tude. What’s your organization’s attitude toward what some call a work ethic? Is it that heroes get special treatment? Bonuses based on the amount of time you put in? That slack time is unproductive? How open, really, is your organization to the new, the funky, the insane? If your organizational attitude is that of ‘justify every dollar spent with a product increment from the backlog’, we doubt that your teams are finding time to be creative.

•    R&D. Why is it only the ‘chosen few’ who get to be on the Research and Development team? Innovation knows know limits or boundaries, so why do we set up these artificial boundaries called R&D? Rather, how can we empower and inspire everyone to think creatively? Here’s an idea: provide a place to capture those random ideas (The Innovation Backlog). Give employees the chance to make a business case for funding consideration. Work these in cycles just like any other project or list of things to do. The customer is the funding board. Encourage creative thinking even in the mundane, planned backlog items: Lee and I consistently see higher energy in teams who are working on the new technology, the new widget, the new thingamajig. This is because there is a level of R&D involved here, and the entire team contributes, shares discoveries and builds upon those discoveries.

•    Iteration planning and execution. Agile teams plan for and commit to a reasonable amount of work from the product backlog. This ensures that the iteration timebox will be stuffed with work that the customer has pre-defined (“kanban”). Then, the looming deadline inhibits out-of-the-box thinking. To counteract this, have each team reserve four working days of a 30-day calendar iteration for creative work, to dream up new ideas or chase ideas from the Innovation Backlog. Additionally, coach your managers to inspire creative approaches even in the mundane predetermined work. Discourage product managers from telling the team how “we do that around here.”

•    Day to day interaction. Do you have time for pairing? Or does your company see this as a waste? Do you still encourage the expert resource to stick to his/her area of expertise and specialization in order to move faster? Encourage everyone to get involved and share expertise. Individuals will learn more, in the long run giving your organization more flexibility and innovation. Oh, you'll have to reward for this new behavior, especially amongst those who wish to protect their knowledge kingdoms for 'job security' purposes.

•    Balance structure and risk by adopting a venture capital model to fund innovation. The funding board can “invest” in a new idea, making time and money available for development. As the work proceeds, the board can establish benchmarks: when they’re met, and the idea still has legs, it invests more resources. This not only supports the individual project, but sends a message to everyone: “This outfit makes room for the new.”

•    Hiring. Instead of asking a potential hire, “What certifications and degrees do you have” ask, “What’s the most creative use of technology that you’ve implemented”? Get a sense for the person’s ability to think in creative ways, to chase ideas past reasonable limits. Can you feel a passion and excitement for making new things, or is IT/NPD simply a job that his college advisor told him pays well?

•    Educate customers on the need for experimentation. Remind them that creativity can sometimes take calendar time. Will your customers go to the cheapest bid or to the company/team that can produce unusual (and unusually useful) results?

•    Put current initiatives into the following categories: Run the business, Grow the business, and Transform the business. How do your initiatives stack up? We suggest 25% allocation to the Transform category. Here’s why:

Not every innovation is THE innovation, so we need to allow for more iterations. Let’s take one of Stacia’s favorite products: the Dyson bagless vacuum cleaner. Mr. Dyson mentions in a commercial that it took 5,000 prototypes to create the perfect bagless vacuum cleaner that never loses suction. And he goes on to say that it would have been easy to look at these prototypes as failures; instead, they viewed these early ideas as learning opportunities, as necessary steps on the way to success. The result: a vacuum that cleans up all of the dog’s hair and doesn’t require bags or a ton of maintenance. If Dyson had budgeted for only 100 prototypes (or 4,999 for that matter), the product wouldn’t be as good, or perhaps wouldn’t exist at all. And last time we checked, Dyson profits were up.

Embrace iterations as experiments - after all that's what they are. They apply the scientific method of building a hypothesis and an approach to the solution (iteration planning), testing it out (iteration work) and concluding with "was it right?" or "was it wrong?" (iteration acceptance).

Each iteration for each of your teams holds within it some new discovery. Managers can properly set the stage so that these ideas are chased as well as provide a mechanism for discoveries to percolate through the organizational froth.

Next week, we'll look at what individuals on a team can do to prepare themselves for creativity.