W&WP June 2002

Three Drivers of Success, Part 2 -Innovation

By Tom Dossenbach

As I stated last month, I believe there are three important drivers to a highly successful company - especially during these challenging times of rapid globalization and economic uncertainty. These are: leadership, innovation and management. While they are separate, they are interrelated and, in fact, interconnected as represented by the three cogwheels on this page. Again, I remind the reader that all three of these are indispensable and must work in harmony to power a successful company.

The thoughts that follow are regarding the second driver of success, innovation. Unfortunately, a lot of woodworking companies think innovation today is something that is done only in the digital world, by the dot.coms or other high-tech companies. Of course, they are wrong.

What Is Innovation?

Webster's definition of innovation is clear and simple. Innovation is "the process of making changes" or "a new method."

It should not be difficult to acknowledge that innovation is essential for the success of any company and that yours or mine is no exception. A plywood company, a furniture manufacturer, a kitchen cabinet manufacturer, a supplier of hardware and a consulting firm all must have a passion for innovation if they want to survive the incredible competitive pressures of today. If you have only glanced at the pages of this column over the past three years you have gleaned this over and over again.

If you are doing things in your company the same way you were doing them five years ago, you should be very concerned about the future of your company.

For example, a furniture manufacturer that is still running everything through its plant in large batches is not overly innovative. A company with thousands of parts that make up hundreds of kitchen cabinet SKUs is not innovative in cutting costs.

If your company still has the traditional "top-down" management structure and a rigid "chain of command" as in the past, you cannot claim to be an innovative company. Finally, if your employees are generally unhappy and you have employee recruitment and retention problems, your company is probably not being creative in trying new ways to attract and utilize your human resources.

If you were to look for a new job, would you look for one that is a left over relic of the 70's or would you want to join an innovative 21st Century company utilizing cutting-edge manufacturing and management methods? Why?

Innovation and Creativity

Lately, I have been getting calls almost every week from newspaper and magazine writers asking where the furniture industry is heading, or what are the greatest challenges to the industry today, and how are we going to survive the onslaught of imports? Everyone is looking for the answer.

The reality is that all three of the drivers are needed to ensure the future of our industry and of your company. Without innovation a company will only manage to get by at best. Leadership is needed to inspire others (as we mentioned last month), but innovation is an indispensable driver that is necessary to focus that leadership and to steer the company in the right direction.

Innovation does not necessarily mean invention. I have participated in discussions regarding the future of the industry in industry forums, association meetings, boardrooms and in company presidents' offices. Often, I get the impression that everyone is looking for a yet-to-be-discovered silver bullet to solve all of our ills. In addition, some are looking for new inventions in systems or machinery to instantly empower us to compete with China.

Innovation can simply entail creative ideas - coloring outside the lines. I am called "the crayon guy" around the industry. I have passed out over a thousand boxes of crayons during workshops, seminars and speaking engagements and to clients. I have dubbed a box of Crayola Crayons as the management tool of this century because it represents innovation and creativity, essentials for success.

I have written about this before. (See December 1999 and August 2000 Management Matters.) Last fall, I visited a small but very successful furniture manufacturer in New England. A few minutes into our conversation, he opened the top drawer of his desk and pulled out one of those boxes of crayons I have passed out. He said it had been a reminder to be innovative and that was clearly evident as we talked about his company.

To be competitive, a company must reduce costs and eliminate waste of all kinds while still making a superior product. Some say this is nothing new, that they have been cutting waste for years. That may be true, but what has been considered as acceptable waste in the past is now unacceptable and is driving the cost of products to a non-competitive level.

If you are, as Webster says, in the process of making changes or implementing a new method in your department or company to eliminate waste, you are innovating and using your crayons. Hopefully, you are sharing crayons throughout your organization and encouraging all of your employees to use them.

Are you innovative in your job? Is your company's management innovative? Does your company encourage innovative thinking from every employee? Can you truly say your company is innovative throughout? If any of these questions is answered no, your first innovation should be to become innovative.

Examples of Innovation

An important point I want to convey is that you do not have to be unique in your approach to be innovative and you do not have to be a graduate engineer. Anyone and everyone can be an innovator in their job. The following are just a few examples that you can implement in your company.

* Managers - Implement a continuous improvement program throughout your organization dedicated to finding innovative ways to meet your challenges. Get all employees involved.

* Supervisors - Study and then train all of your employees on the basics of lean manufacturing and implement those principals with recognition and reward for those who lead the way.

* Sales Managers - Look at your domestic market and make sure your niche is well defined and that you are focused on your core competencies to meet the needs of this market. Then, look at your export and import opportunities and formulate strategies to allow you to grow and prosper.

* Management - Empower every employee to challenge everything you do and the way you do it and be willing to change and to adopt any ideas that will improve the value of your products as perceived by your customers.

* Employees - Consider your main job as innovation to make a better product for less.

* Managers and Supervisors - Open yourself to criticism by others to make you a better leader, innovator, and manager and thus make the company stronger.

* Product Engineering - Look at your product lines and simplify them and cut the number of different parts required by 30%, and then do it all over again. While you are at it, reduce product development time by 50%.

* Top Management - Conduct a critical operations audit throughout your company every three years to identify strengths and weaknesses and set corrective action plans where needed.

* All Employees - Accept new ideas as exciting avenues to explore and turn away none without due consideration.

By now I hope you subscribe to the idea that there is no excuse for a company to be without innovation. Leadership comes first as we mentioned last month, but innovation must follow.

You now have two of the three drivers of success. Next month we will add the third - management.

Part one of the three-part series is available here

Have something to say? Share your thoughts with us in the comments below.