Leadership support for innovation is critical to an organization. Any leader knows how to spell innovation. But few senior leaders understand what is involved or how hard it is unless they have come from an “innovation background.” What are some essentials of innovation leadership? In today’s show we discuss the role of the CEO and the Board of Directors. We also consider the benefits of an effective Innovation Advisory Board.
Role of the CEO
What is the role of a CEO running an organization?
- To set the vision.
- To establish the leadership team.
- To define the objectives for the organization.
- To hold self and others accountable to achieve the vision and objectives.
The CEO crafts a structure and a budget which the Board approves or disapproves. Where does the innovation aspect fit in? Innovation should be part of how an organization achieves its vision. It should be funded and resourced to enable the vision and objectives. The CEO should promote innovation and its role in the organization. The CEO should hold the leadership team accountable for innovation.
Common reasons that a CEO does not provide the innovation leadership needed:
- Funds only where there is a clear line of sight of the results.
- Uncomfortable with the unknown or associated risks.
- A weak relationship with the Board.
- On shaky ground with the Board because of past mistakes or failures to deliver.
- Doesn’t believe in the value and impact of innovation.
- Doesn’t know how and won’t ask for help.
What should the innovation leader do when the CEO is not fully engaged in the innovation efforts? First, start small. Find the hidden project that someone has been doing in stealth and get behind it. Next, lay out a clear plan and metrics that can be shared with leaders and the Board of Directors. Lastly, gradually gain their support. After concerted effort, if there is no support, this organization may never give innovation a role.
Board of Directors
While the CEO may be the focus when it comes to innovation, the Board plays a critical role. The Board is the “boss” of the CEO. The Board has control of the budget – a key resource for innovation. A Board’s commitment to innovation is shown by the time spent talking about it in Board meetings. Another indicator is willingness to make it a priority in the budget process. The committed Board understands and is comfortable with the fact that risk is associated with innovation. The Board, with the CEO and innovation leadership team, sets realistic, high quality innovation metrics. A Board conveys support by “protecting” the CEO when it comes to stakeholders.
A big risk for many organizations: most Boards do not have members from an innovation background. You need people on your Board who have lived it.
How does a Board get guidance on encouraging and supporting innovation?
- Find outside consultants that can train the Board.
- Have innovation leaders meet with Board members one on one to educate them.
- Find organizations that have innovation at their core.
- Create an innovation board of advisors.
Establishing an Effective Innovation Advisory Board
How can you get the CEO and Board to embrace innovations when it is not part of the DNA? Recruit an Innovation Board of Advisors. This Board of Advisors should contain the innovation leader from within the organization. Other members should be proven innovation leaders from outside the organization. No consultants. The Innovation Advisory Board meets with organization leaders and the Board of Directors. It provides guidance and feedback. A rewarding experience for me was serving as an outside member of the Roche Innovation Advisory Board. I was tasked to help their innovation and management teams get “fresh eyes”.
What did I learn from serving on an Innovation Advisory Board?
- IABs can play a critical role in bringing outside perspectives.
- IABs are outside validation of what and why you do the things you do.
How would I set up one today?
- Find the best people.
- Be prepared to pay for Board membership.
- Set clear focus and expectations.
- Make it real, not window dressing.
- Give them visibility to your leadership and Board.
- Plan a rotation of membership.
Want to know how to engage your CEO and Board of Directors? Looking to establish an Innovation Advisory Board? Reach out and drop me a note.
To hear about the benefits of an effective Innovation Advisory Board, listen to this week's show: Innovation Leadership: The Role of the CEO, Board, and the Innovation Advisory Board.