Principle 8: Learning, innovation and continual improvement (Item 10)
Continual improvement and innovation depends on continual learning.
You should take a strategic approach to learning (eg, you should have
learning objectives; and strategies to grow your core competencies and
knowledge.)
Principle 8 states that your ability to innovate, to develop and implement
new ideas, depends on your capacity to learn. The marketplace has a
frenetic rate of change. All companies have to adapt rapidly and be
very innovative just to keep up. Innovation itself should be a strategic
issue. Because innovation depends on learning, learning must be a strategic
issue as well.
You must develop your ability to learn and develop knowledge. Make
it a Key Result Area. Build your core competencies, work systematically
to overcome the barriers to learning.
The shift to an `learning company' requires a considerable shift in
the concepts on which most companies are based. It means a shift in
the assumptions of the company and some coherent, understandable, and
practical actions if battle capability is to be developed.
The company must recognize that innovation and continuous improvement
depend on continual learning; and actively work on strategies
for everyone in the company to learn together. Innovative practices
must be valued as drivers of company improvement.
Of course, a question worth asking is "Does the battle need to
be fought?" Our need for survival and growth suggests that you
need to do something and it should be different from your past approach.
This implies that you have learned from your past approach.
The focus must shift to the nature of your alliances, your reading
of the tensions and the opportunities around you, and your capability
to make profound and surprising intelligence from them. Then, from a
military perspective, ideas such as deterrence, mobility and superiority
might apply.
Remember the core competencies we described in Principle 2 (`Focus
on Achieving Results'). Your core competencies are what the company
is very good at doing — what makes the company special – and
different from other companies. You support them by your underlying
skills, learning, knowledge and experience. The core competency is what
defines the difference between a bank and a law firm. Each has developed
skills knowledge and experience in different competencies. The bank
has core competencies in finance; the law firm has core competencies
in law. Even where their interests appear to coincide, they take their
own approach. The bank's legal branch is not a core competency of the
bank.
A company's core competency is usually earned in a school of hard knocks.
Learning accumulated though mistakes and successes. Learning what works
and what does not work. Experience.
When a company tries to change its core competency (from say steel
making to mining), it has to go back to square one in its learning.
All of the learning it gained in the previous competency is worthless.
Companies should seek to make the most of their core competencies -
increase them. They should not be sold off - doing so is selling what
makes the company work.
Yet, we often see examples of companies failing to think strategically
about their core competencies and selling them off in their downsizing
activities. Selling your core competencies is selling what makes the
company work. When they are sold, it implies a major change in direction
– hopefully to meet an emerging, more lucrative market – or
stupidity.
A rule of thumb for investors. When you see a
company sell of its core competencies as part of a downsizing or a change
of direction, sell your shares.
The barriers to learning include all the barriers to innovation described
above.
Trust and a learning environment. In particular, we would emphasize
that the foundations to learning are laid by a full implementation of
Principle 7 (`Enthusiastic People') and creating an environment of trust
with Principle 1 (`Role Models'). If these are not in place, people
in the company are more interested in survival than in passing their
wisdom on to others in the company.
Systems to retrieve knowledge. Learning is a process whose
output is knowledge. You need systems and processes so that
you can find the knowledge. We believe that you do not know something
unless you can retrieve that information. Knowledge is lost when you
don't know what you learned, when you can't find the policy document
you issued last month, when the right hand does not know what the left
hand is doing, when you continue to make the same mistakes or when you
continue to do the same things expecting a different result.
Given the importance of continual improvement and innovation, and the
how much they depend on continual learning, you had better be able to
find what you know.
People hoard knowledge: Players in companies have known this
since Machiavelli's time and withheld or dealt in knowledge – often
to their own advantage and the detriment of the company.
People will not cheat: Most school systems come down very hard
on people who cheat. A lesson that most people take with them into the
workplace. Unfortunately, in the workplace cheating (or, benchmarking,
or copying) are very good qualities. As we have said above "steal
ideas shamelessly". If it is someone else's intellectual property,
ask permission and acknowledge their contribution, then add to it and
adapt it. The growth in knowledge and learning is to everyone's advantage.
Footnotes
This section comes from material
prepared by Chris Russell.
|