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Published by: Giancarlo Colombo on May 28, 2010
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– The Next Frontier in the Human Capital Agenda?
by Jennifer A. Moss, Ph.D. Director, Bellevue University’s Human Capital Lab


“Innovation – The Next Frontier in the Human Capital Agenda?” | Jennifer A. Moss, Ph.D.

Innovation is a topic currently at the forefront of business leaders’ minds. The December 2009 issue of Harvard Business Review and a recent study, “The Innovator’s DNA,” both featured innovation and characteristics of innovators. To understand how innovation might impact the growing human capital agenda, the following questions should be taken into consideration: 1. 2. 3. 4. Are innovators more valuable to organizations? Should everyone within an organization innovate? If innovation is truly disruptive, how much disruptive activity can an organization tolerate? If innovation is an element of human capital, how do we identify and measure it?

In the most innovative companies, the senior executives did not delegate innovation. Rather, they were innovative.
- The Innovator’s DNA study

“The Innovator’s DNA” study found that in the most innovative companies, the senior executives did not delegate innovation. Rather, they were innovative. This finding supports the notion that organizations can tolerate only a few innovators, and the rest should fall in line with innovators’ visions. A concrete understanding of whether this notion is accurate for most or all organizations would simplify the human capital agenda. The study focused on entrepreneurs, viewed to be true innovators, and their personal characteristics. Once these entrepreneurs developed a new idea, they found like-minded individuals to join in the implementation of the idea. As companies grow, these entrepreneurs need to bring in workers who can maintain the business. With only the top rung of the organization innovating, the remaining workforce is on board to create efficient processes, build scalability, and monitor the work. When senior leadership is responsible for innovation, this doesn’t mean the staff and line workers, middle management, and even emerging leaders cannot innovate. However, broadly declaring an organization as “innovative” might give some the impression they have carte blanch to venture down their own path, which is the disruptive part of innovation. Innovation engages the right side of the brain, or the creative side. This type of right-brain stimulation motivates workers and creates energy and enthusiasm within the workplace. However, there must be a happy medium where everyone within the organization uses innovative skills, yet stays on task enough to not upset the apple cart. In the human capital agenda, this is the process that should occur. In order to implement this process, learning leaders must have a sound understanding of the five skills innovative leaders posses to create training and education programs that foster these specific skills. Five Skills of Innovative Leaders The DNA of innovative leaders can be summarized into five skills:  Associating  Questioning  Observing  Experimenting  Networking All of these skills can be learned, which means innovation can be developed in employees and fostered in organizations. From a human capital perspective, the questions become: “How can we encourage innovation in our organization?” and “What is the impact of an innovative culture?”
© 2010 Bellevue University. All rights reserved. Page 2

“Innovation – The Next Frontier in the Human Capital Agenda?” | Jennifer A. Moss, Ph.D.

Associating: This is the ability to apply ideas and concepts from one situation to another. As defined, human capital is one’s transferable and cumulative knowledge, skills, and experience. For example, what one learns at a first job will help him or her function more effectively in a second job. Organizations should attempt to recruit individuals with vastly different backgrounds and industry experience to create more opportunities for associating within the workplace. Questioning: This means simply being curious enough to ask why something works. To ask questions, employees must feel safe and high levels of trust must be present. Employees must understand that asking questions will not be perceived as ignorance or inexperience. The more employees can learn in the workplace, the more the organization builds its human capital. Observing: Conscious of it or not, we continually observe fellow workers and customers’ body language (75 percent of all communication), behaviors, habits, strengths, and weaknesses. What we do with that knowledge is powerful. Using our observations to make informed decisions and calibrate our own behaviors utilizes our human capital. Imagine a workforce of customer-facing employees skilled at observing. How might that: 1) impact our customer service agenda, 2) impact conflict within organizations, and 3) streamline decisionmaking processes? Experimenting: Experimentation is a mindset bent on seeing how things work. Once we know how things work in one scenario, we can insert new variables into the equation to see impact. Experimentation is largely lacking in most U.S. organizations, outside of the R & D group. Experimentation is the disruptive nature of innovation. However, if organizations want to grow, they must embrace some level of experimentation. Learning organizations create an experimental environment for employees because collectively, the organization can learn just as much from failure as success. Networking: The last of the innovative skills might be the most important as it creates opportunities for the other four. Internal and external networking have been empirically linked to many positive outcomes for employees, and now it’s essential for innovation. Networking allows employees to cross-pollinate with other industries, markets, and mindsets and to use this knowledge to the organization’s advantage. Organizations need to create and reinforce policies that encourage networking because it may be the simplest way to increase innovation within an organization. Innovation might be the next frontier on the human capital landscape. Innovation can be encouraged by organizations and fostered in individuals at no cost. The potential ROI of innovation might astound organizational leaders since the cost is negligible, and any return is benefit. If learning leaders purposefully encourage the five elements of innovation, we’d see our collective human capital increase. As many CEOs declare, “Our people are our greatest asset.” Increasing those assets then becomes an imperative. If you’re ready to learn more about enhancing your human capital agenda and corporate learning initiatives, see CorporateLearning.com or call 877-824-5516. Visit HumanCapitalLab.org for original research and leading-edge analytics on the impact of learning on human capital.

Learning leaders must have a sound understanding of the five skills of innovative leaders to create training and education programs that foster these specific skills.

© 2010 Bellevue University. All rights reserved.

Page 3

“Innovation – The Next Frontier in the Human Capital Agenda?” | Jennifer A. Moss, Ph.D.

Innovation at Work
In a recent Ernst and Young survey, 41 percent of surveyed senior executives stated that when it comes to innovation, what’s missing is “the big idea.” The opposite may actually be the case. Innovative leaders and their ideas are present at leading organizations across the U.S. When The Home Depot partnered with Bellevue University to create the Professional Retail Management (PRM) customized learning program, the two jointly worked with The Home Depot’s Chief Learning Officer to find innovative methods around a myriad of barriers upon implementation. The Home Depot CLO and Bellevue University leaders used experimenting, associating, and questioning skills to provide insight on the development phase of the PRM program, which is now deployed nationwide to employees of The Home Depot. A common barrier often experienced by organizations including The Home Depot is the reluctance of Human Resource/Benefits departments to support internal employee communication for specific degree programs or universities. However, because the PRM program was collaboratively designed with leadership at The Home Depot and included language and decision models used by the organization daily, the HR team agreed to support internal communication of the program. Learning in the PRM program, as opposed to an off-the-shelf bachelor’s degree from any university, allows an employee to both learn and contribute to their company more rapidly. The HR department agreeing to support internal communication to all employees about the PRM program is innovation. That communication required a break with tradition, the support of both HR and operating managers, and an investment in print material, electronic messages, and a co-developed website. Individually these look simple and logical. Collectively they represent a significant departure from the norms of the past. In many ways this shows innovation as being something very different than “the big idea.” What it shows is a focus on a worthy goal followed by sheer tenacity and willpower. One-byone barriers fell and an integrated internal communication solution emerged. Most often, what kills innovation is reflected in an organization’s culture, i.e., “We’ve always done it this way.” Even if decision makers do not say it, the given is there. The myths and traditions of an organization often lie just under the surface of discussions disrupting the flow of innovation while new ways of looking at issues get ground down by decision makers with invested interests in what already exists. It takes a vision and willpower to change this reality.

CorporateLearning.com © 2010 Bellevue University. All rights reserved. Page 4

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