December 6, 2021

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Innovation Is Everyone’s Business | INSEAD Knowledge

Innovation is possible by providing employees with the tools and motivation to come up with new ideas.

The fabric used to reinforce car tire tyres may not seem like a source for innovation inspiration. But in just a few years, Kordsa, a part of the Turkish industrial conglomerate Sabancı Group, transformed itself from a price-driven maker of commodity products into a provider of innovative solutions to clients across multiple industries.

While there are many reasons for Kordsa’s remarkable success, the process began with senior executives giving permission to everyone in the organisation to innovate.  

Most companies recognize the importance to encourage innovation. Good ideas can reduce production costs, open up new markets, and save money. Yet despite the compelling evidence, it’s not always obvious what steps are needed to integrate innovative practices and thinking across an organisation.

A blueprint for innovation

Based on over twenty years of researching, teaching and consulting for some of the world’s leading companies, I’ve attempted to address that shortfall. My book Built to Innovate. I aim to map out a proven system for building constant innovation into your company’s DNA. I explain this. There are three key processes that I recommend to build an innovation engine into any organization: Creation, Integration and reframing

Reframing and Integration are about changing mindsets, and implementing new innovations throughout an organization. These will be discussed in greater detail in subsequent articles. The act of creating ideas is what creates innovation. It is also about ensuring that those ideas are being generated throughout an organization, especially by frontline workers.

As you can see in the Kordsa case, this is a process that requires people to be able to think for themselves and to be motivated to do so. In other words, they need the permission and resources to innovate, as well as the motivation and skills to succeed.

Democratization of idea creation

Cenk alper was the Kordsa’s executive charged with instilling a culture for innovation. He started by conducting a survey of the entire company to identify innovative ideas already being implemented within the company. He then ensured that these innovations were recognized and rewarded.

Alper also invested in a new internal technology centre in a bid to upgrade the organisation’s R&D operation. He also ensured that every department of the business was working on at minimum one innovation project. This helped to embed the idea of creativity throughout the organization.

However, perhaps the biggest step to ‘democratise innovation’ as Alper described it, was the launch of Total Productive Maintenance (TPM). This was an innovation training program that was offered to all employees, from frontline workers to senior managers at all 12 facilities around the world.

Alper, a senior leader in TPM, went through the training and made sure that all middle managers were also trained. TPM gave employees the tools and techniques they needed to invent, and TPM also showed them that they had permission to do so.

The results were impressive, and they went beyond the development of new products. One of the innovations was a dramatic reduction in the time required to replace an oil filter on the assembly lines. TPM led to the creation a buddy system for new employees that reduced the pressure on the HR department. It also helped to build closer relationships between employees.

Clients closing the gap

Kordsa also sought to reduce the distance between potential customers and innovators in order to aid the idea generation process. This is something that I believe is key to any organization’s innovation engine.

A state-of-the-art experimental laboratory opened its doors so customers could visit and bring their ideas and challenges to Kordsa’s scientists. Meanwhile, cross-functional teams spent time camped in the customers’ plants to better understand their unmet needs and challenges.

This process resulted in the creation of a new type tyre cord fabric. Capmax, which is a brand name, was developed to address a common customer complaint: the need to eliminate several costly and time-consuming steps in the tyre manufacturing cycle.

These new products didn’t just help the organisation become recognised as an innovator within the tyre manufacturing industry. They also opened up new markets for their innovative composite materials, such as electronics and aerospace.

Inspiration for creativity

Motivation of employees to create new ideas was the final piece in the puzzle. The thoughtful design of a stage gate process that allowed employees to create innovative ideas was one way to achieve this. Before an idea can be passed to the next stage of development it must meet a number of criteria.

However, to protect innovators from the stigma of failure, and to avoid prematurely killing ideas with potential, the process incorporated ‘positive discrimination.’ This meant ideas were not bound to the normal commercial pressures and profit requirements for the first five years. This modification gave the Kordsa teams extra time to fix any flaws or teething problems.

Kordsa shows what can be achieved when an entire organization commits to the idea and practice of creation. The organisation has been rebranded as a technology innovator thanks to its many innovations. This has earned it numerous awards. It is also now ranked third for R&D capabilities among all Turkish corporations.

The ever-expanding range of innovative materials have allowed the company to grow its business into a raft of previously unconsidered areas, while Alper went onto become CEO of Sabancı Holdings. He is a firm believer in the importance and value of giving employees the tools they need to succeed.

This is, arguably, the most obvious sign that he gives to his employees to show his approval for them to embrace innovation.

This article is part in a series of articles that use specific case studies from the book. Built to InnovateBen M. Bensaou’s article outlines three key processes for building an innovation engine within your organisation: Integration, Creation and Reframing. 

Ben M. Bensaou.He is a Professor at INSEAD of Technology Management and a Comparative Management and Asian Business Professor. From 2018 to 2020, he was Dean of Executive Education.

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