How do you tap into your largest resource of innovation for your compliance program, which is of course your employee base? That topic was explored in an article in the MIT Sloan Management Review, “How to Catalyze Innovation In Your Organization” by Michael Arena, Rob Cross, Jonathan Sims and Mary Uhl-Bien. This article posits that companies can “fuel the emergence of new ideas by understanding and tapping the power of employee networks.”
The tenets and concepts the authors articulated provided several useful insights for a CCO or compliance professional. The first was that “companies need to create context that allows people, ideas and information to flow across different groups.” The second identifies a group of employees who operate as brokers and they create “bridges between groups” within a company. These brokers should work with “central connectors, who are well-connected in one subgroup” to form a powerful network. Finally, “when facing a problem, innovators should engage their network early on.”
Interestingly, as with the ever-dwindling myth of the rogue employee in FCPA enforcement, the authors note, “Tales of a lone inventor with a blinding insight are unhelpful myths when it comes to corporate innovation. Successful service, product, or process innovations within large, complex organizations are very much a social phenomenon.” A successful CCO will know that they need to leverage employee networks for both innovation and communications of compliance initiatives.
The authors key insight was their three divisions of social networking within an organization. They believe “A key to catalyzing emergent innovation is identifying and positioning innovators within an organization.” Moreover, it is the use of these networks which can move innovation back up to the top of an organization and communications down through a company as well.
Brokers
Brokers are the group of employees which build bridges from one group to another within and outside an organization. This allows them to act as critical channels of information and ideas. Brokers offer three competitive advantages: broader access to diverse information, early access to new information, and control over the diffusion of the information. Yet more than simply acting as conduits, “Brokers facilitate this discovery process through their social connections and then determine how and when these insights can be introduced to other parts of the organization. The creation of adaptive space enables brokers to more actively connect and navigate beyond their local subgroups to explore new possibilities.”
Central Connectors
The second group is “central connectors” who provide group cohesion for implementation of innovation and communications going forward. The authors stated, “Group cohesion represents how connected individuals are to one another within a group. A group is considered cohesive when many redundant connections exist among group members. That is, the likelihood of any individual within the group being connected to any other individual within the group is high. As a result, cohesive groups can quickly share information and generally operate with high levels of trust.” These central connectors can take an idea and move it into more disparate groups to diffuse both ideas and communications; in short it is often these central connectors who will drive an innovation to success.
While some industries and companies resist rotation for a CCO or compliance profession, it would appear the better practice is to use rotation as a catalyst for innovation and change. The authors noted one example where employees were moved between projects every three years or so which allowed knowledge to flow around more readily. The authors concluded that the company had “provided the space that enabled an active interplay between brokers and connectors.”
Energizers
The final group identified by the authors are the “engergizers” who can work to “trigger the interest and engagement of others and unleash the passion necessary for bold innovations to advance.” The authors believe that many factors can drive this including “Network energy, or enthusiasm, drives diffusion, co-creation, and active engagement across the larger organization.” The energizers challenge those within a company to “think more boldly than they would within their own subgroups and creates a contagious mindset as the innovation progresses.” Finally, “Energizers are able to fully engage in interactions, inspiring others to devote more time and energy to an initiative. The reputation of an energizer spreads quickly across the network, attracting others to aggregate multiple ideas into bolder, integrated concepts that are more likely to succeed. Energizers connect with individuals who have different expertise or backgrounds. These differences can be embraced as elements essential to the creation of bolder innovation.”
Through these three differentiated groups, there are five steps around innovation for the CCO to consider going forward.
There are always pockets and groups within an organization which resist change. Often this is one of the CCOs most difficult task. Yet the authors have laid out a clear path to overcoming such resistance and it is equally applicable to moving compliance communications through an organization. By using central connectors and energizers, a CCO, the broker, can get the message of compliance moved faster, in a more complete and enthusiastic manner. Finally, this will go quite a long way towards operationalizing your compliance regime.
Three Key Takeaways
This month’s podcast series is sponsored by Oversight Systems, Inc. Oversight’s automated transaction monitoring solution, Insights on Demand for FCPA, operationalizes your compliance program. For more information, go to OversightSystems.com.