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Innovation Catalyst

Growth Strategies for Tech Companies
Bridge over a missing gap

Leadership Required to fill the Missing Middle

The Missing Middle

In our previous post, “the missing middle” is described as the oft forgotten place on the continuum of innovation; “…the space between [the core business and disruptive innovation where], growth can emerge by leveraging current business capabilities.

What is the Work of Leaders Here?

But one can ask rightly, “What is the role of leadership here?” In the ideal world, being proactive in crafting an innovation agenda and the culture that can make it happen may well yield a robust and continuous innovation portfolio where the middle is indeed not missing.

Or as is often the case, leaders find themselves in a cultural and organizational tug of war between the core franchise and moonshot projects, and need to create a new conversation that engages the workforce, builds bridges between strategic and operational interests, and fosters a culture of learning that sees adjacent opportunities through the lens of value and uncertainty.

Do Right By the People

In 2014, a Fortune 50 high technology company conducted its annual employee engagement survey and received a 93% response rate. Because of an expressed concern about the lack of growth, the executive team was keen to better understand the relationship between “engagement” and “innovation”, and in particular adjacent opportunities.

To that end, five questions on the 58-item engagement survey were built into an Innovation Index. The questions focused on cultural, leadership and process dynamics that either help or hinder innovation. For example: I feel free to take informed risks in getting my work done.

The results were compelling and useful. When all the statistical magic was done, a focus on only four items would very likely produce the “culture of innovation” described by the Innovation Index. (4 items explained 70% of the variance) This would not have been all that helpful if a litany of questions were required to make the strong connection. Four items however, provided a practical call to action for leaders, and a focus on environmental or cultural influences over which leaders have either direct control or strong influence.

 The Top Four

  • Promote process improvement
  • Apply resources to new ideas that will drive future success
  • Create the space for employees to challenge the status quo
  • Provide opportunities for employees to learn and develop

Bottom-line: Leaders working diligently on a few areas of engagement are likely to make a substantial, positive difference in fostering a culture that produces meaningful adjacent innovation.

Work the Seams

Simply speaking there are two prevailing “voices” in many organizations: the Strategic and the Operational.

Strategic Voice Operational Voice
Strives to be “roughly right”

Considers long time horizons

Treats uncertainty strategically

Explores and chooses among significantly different alternatives

Needs a holistic viewpoint

Concerned with external world

Seeks precision & accuracy

Focuses on near-term results

Calculates risk statistically

Limits new alternatives— “Let’s get going!”

Divide and conquer—functional silos

Strong internal focus

 

Though these “voices” often speak past each other, the place of the missing middle finds these two “voices” naturally harmonious if leaders intentionally work the seams of an organization. One practical approach leaders can use to gather these mindsets for results oriented collaboration is to create multidisciplinary teams that learn in quick cycles; teams that leverage current capabilities and new ideas into in-market experiments using “low resolution prototypes” that consider product, service, and business model innovation.

Bottom-line: Leaders working intentionally to promote collaboration and build processes between disciplines ready an organization to “leverage current capabilities to address new markets, build complementary solutions or revolutionize business processes – frequently all three together.” This often requires an investment in developing leadership capability through intensive, experiential, peer-peer coaching, and mentoring opportunities.

Leadership Required!

Leaders, who engage teams, intentionally work the organizational and cultural seams, create the space for multidisciplinary design to happen, and appreciate the range of current capabilities, solve the problem of the missing middle.

Help for the Missing Middle

This kind of strategic approach can be difficult, especially for busy executives immersed in running the business. We at ICG have developed a 1-day Missing Middle workshop that will engage your leadership team in developing a plan for discovering your path to adjacent business growth. Contact us for a quick call to discuss whether this approach will work for your business.