Innovate to win

Berkely says companies must have a commitment to cont---improvement and innovation.

In the current 'hot' Middle East labour market, we have observed that many companies are taking defensive postures ("circling the wagons") to retain their key talent.

The tactics are self-evident in reactive increases to base pay and allowances, the creation of special project teams or vague promises of future career opportunities.

They may be temporarily successful in warding off an attack, but no organisation has ever achieved long-term success, let alone dominance in a market, in a defensive position.

Given an organisation's strategy is a direction, the driving force needed to achieve it must be some type of forward motion. There must be a commitment to continuous improvement, and most importantly, innovation.

The very nature of the work requires constant examination from all those individuals within an organisation tasked with the responsibility.

Here are a few diagnostic questions to help you unearth where you are now and where you perhaps should be focused:

• Does your performance review and reward system emphasise the behavioural changes necessary to achieve your business strategy?

• Does it also enable you to measure progress?

• Do your top management's actions visibly support the exemplary attitudes and responses that you want your employees to espouse?

• Are your employees truly engaged in value-added activities in terms of the customer, product, and service?

• Do you allow your employees to determine their own approaches and design their own jobs?

We have observed with the overwhelming majority of employers in the region, that many of them think they foster innovation but they don't - they foster problem solving. Not that problem solving is not an important activity, and is required in every organisation, but not at the expense of innovation.

In problem solving, if business-based human resources metrics (operating performance, people costs, turnover and vacancy rates) worsen, you fix it. Good companies do this all the time. However the best result of effective problem solving is that the company is as good as it used to be!

Yes, you've restored performance to an acceptable level but no better than that. In innovative environments, companies are setting new standards, and that is the hallmark of leading organisations.

You simply cannot successfully implement a strategy if the company is intent on retaining the status quo and fixing things that go wrong. Successful strategy implementation requires that everyone is looking to improve performance constantly, with small incremental changes that collectively achieve dramatic results.

It is vital that employers in the region look at each element of their employee's reward and performance, and their role in 'raising the bar'.

Ask colleagues

Do you foster innovation or problem solving? Take the litmus test - what percentage of your management time is spent on problem solving to that spent on innovation? Is this the right balance relative to the amount of change set out in your business strategy, and changes in the outside environment?

As a quick test, we asked 10 senior executives and HR professionals in the region to estimate the amount of management time spent on problem solving to that spent on innovation. The ratio is 90:10. I don't know what the proper ratio is for your organisation and your strategy, but it cannot be 90:10.

If 90% of the time your organisation is trying to achieve past levels of performance, and only 10% of the time trying to establish new performance levels, the chances are that your strategy won't be attained.

As a general rule, the more significant the changes in your strategy are, the more innovation must be stimulated. Even in relatively stable companies, the changes in the outside environment require that increasing amounts of time be deployed on innovative approaches if strategy is to be successful.

Berkeley Burke and Co. director James Berkeley assists clients - including Hilton Hotels, Marriott International, and Shangri-La Hotels and Resorts - in improving organisational performance. Contact: www.berkeleyburke.com

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