Rethinking Innovation in Outsourcing: Part 2

Click here read Part 1 of this series.

Understanding innovation is similar to understanding creativity. The two are, in fact, pretty much the same. People who study or experience creativity will tell you that creativity is only possible within limits or boundaries; it never arises without a decision to create, or from chaos or a blank slate. In my own experience in many different fields, from artistic endeavor to the outsourcing business, I’ve observed that creativity requires three factors of limitation and a combination of a strategic and practical goal to be successful. Too many limits stifle the options; too few limits allow too many options (and the attendant indecision). Lack of larger strategy invalidates the tactical goal.

Your limits may be simple (cost/time, old technology impeding change, required customer engagement and satisfaction) and your strategic and practical goal may be lofty (as in the case of the presenters, to make the company the preferred supplier of their complex and relationship-based product by engagement with 23,000 stakeholders through a customizable online interface). But if you can set the parameters and the goal, and create the right working environment, creativity and innovation will result.

Wait a minute. Create the right working environment?

When an outsourcing provider is in the mix, this is the magic key. As the presenters learned, they had to create a trusting environment between their teams and infuse the teams with their own personal enthusiasm. Then they had to create a working process and compensation model that facilitated communication, integration, development, confidence in fairness, and acceptance of ambiguity during the creative process — while still measuring and managing. Sounds complicated, and it is. But achieving substantial rewards does not come easily. This is both process-driven and created by leadership behaviors and values.

Will they be able to do it again? I’m eager to see! Are there lessons to be learned for organizations trying to innovate in less-inviting circumstances? For these two organizations, the problem was project-focused, while for most organizations striving to drive innovation, it is far less clear how to just get started. However, if you step back and look for your strategic objectives, your tactical requirements and the three limits, you can get started with your team-building to create your own conditions for innovation.

I’m going to write a whole lot more on this subject, powered by the thoughts and experiences of many very smart people who are trying to make innovation in outsourcing work. As an industry, we have to rethink innovation in outsourcing, and I want to do it together with you. Stay tuned.

By Cynthia Batty, U.S. lead for the ISG transformation market area

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