It takes a specific type of organizational culture to maximize the talents of software engineers to envision and create innovative software solutions. This type of culture is very difficult to create successfully within an organization that has other key areas. In fact, these cultural requirements suggest that most firms should seek to outsource software innovation to firms that are specifically designed to achieve innovation rather than create a department or division that may not be a good fit with the other areas of the organization.
Innovation has been defined as the process of translating an idea or invention into a good or service that creates value for which customers will pay. By its definition, innovation requires new ideas. But, does an organization’s culture promote or even encourage new ideas? Most organizations do not seek to create a culture that fosters innovation: most organizations seek stability, often by seeking to scale what they have already been successful at doing by finding other markets or applications for its existing products or services. Innovation is uncomfortable. It avoids repetition... Innovation seeks uniqueness.
Management consultant Jeremie Kubicek has suggested that the two primary dimensions of determining an organization’s culture – and culture matters significantly when it comes to performance – are support and challenge. Support is what the organization provides to the employee. Challenge is what the organization expects from the employee. These factors can be low to high based on the organization’s culture. Support can be illustrated by providing the employee with resources, training, competitive products and services to work with and/or sell, and the perception that leadership cares about the employee. All types of performance measures, such as sales, can define challenge. For a software engineering firm, the amount of software written within a specific time frame with the quality of the work can define challenge.
Kubicek further posits that a thriving culture will create both high support and high challenge. As applied to software engineering firms, innovation by its definition is a high-challenge task. Consequently, the focus on an optimal culture for an innovative software engineering firm is determined by the support component of the support-challenge factors to define a culture.
The Center for Creative Leadership suggests that there are two primary factors for successfully creating a culture of innovation. The first is management practices, which are specific actions and practices on the part of management that impact innovation include allowing freedom and autonomy in the place of work and forming work teams comprised of individuals with diverse skills and perspectives. Freedom is defined as deciding what work to do or how to do it, and a sense of control over one’s work. A diversely skilled workgroup, in which people communicate well, are open to new ideas, constructively challenge each other’s work, trust and help each other, and feel committed to the work they’re doing.
The second factor is organizational motivation which is the basic orientation of the organization toward innovation. Innovation needs a culture that encourages creativity through the fair, constructive judgment of ideas, reward and recognition for creative work, mechanisms for developing new ideas, and an active flow of ideas and a shared vision. It also needs a culture that does not impede creativity through internal political problems, harsh criticism of new ideas, destructive internal competition, avoidance of risk, and an overemphasis on the status quo. A culture that supports a software engineering design firm will include these factors. If these factors are not present, then it is likely that innovation will not happen as innovation requires action, inertia is the status-quo.
But, it is these types of cultural factors that in most organizations would not be conducive to fulfilling its mission. As an example, most successful companies seek to create incremental changes when they have significant market share or a competitive advantage. Why change when business is good? This mindset is very common and creates more a protector culture where new ideas are met with opposition. Why change when what we have is working? These companies seek to improve efficiencies and practices, rather than create entirely new ones. And, many of these practices are financial key performance indicators. Innovation is a long-term investment that will negatively impact these measures. This common mindset and these common performance measures logically imply that the culture needed to produce the most conducive environment for software engineering applications is quite unique.
This also suggests that a firm with a software engineering department faces the likely two-fold problem of (1) not being a proper fit with the rest of the organization or (2) not actually existing within an organizational culture that fits its needs. This is a primary reason why most firms need to outsource software engineering challenges to firms that exist to create these solutions, and have created and exist in the environment suited for innovation.
Phase 2 has intentionally created this type of culture over its 20-year history. Phase 2’s purpose is to innovate, to create something that did not exist before to address challenges and seek opportunities uniquely. Some of these intentional efforts include flexible work schedules. When do people create their best work, is it always in the office? Archimedes envisioned his breakthrough in a bathtub, Eureka! Phase 2’s software engineers are provided with the opportunity to know when they do their best work and allow them to do it. In fact, Phase 2 has Productivity Fridays, which are designated remote work days. This encourages this type of flexibility since many offices are known for valuing the appearance of working hard so remote work days would be perceived as not working hard enough.
Phase 2 also has a less hierarchical company structure. A company that seeks innovation must allow significant autonomy by nature, but collaboration is also key where new ideas are always encouraged, but are enhanced and refined through a collaborative process. An innovative culture always values the idea, not the position of the person who conceptualized the idea. But, it is also a team that that builds and expands the idea. Most organizations, especially as the organization becomes larger, rely on hierarchy and longevity. By nature, it is the antithesis of innovation where the new is sought and valued, not the existing. Innovation is not the sole province of senior leadership but can derive from anyone in the organization. The culture must believe and embrace that fact.
For these organizations, a culture of innovation is not a good fit, or even feasible. But, these companies that could benefit and leverage software innovation should seek to outsource it to those organizations designed and developed to achieve breakthroughs. It is much easier to hire a software engineering company tasked with developing new solutions because the organizational culture is designed to promote creativity and innovation by always seeking to discover new solutions and question the existing order. By its purpose and intention, Phase 2 encourages and rewards innovative thinking that leads to breakthroughs. Consequently, innovative companies like Phase 2 are particularly needed by organizations that compete in markets defined by rapid change. It is really difficult to change organizational culture to something that it is not; it is far more effective and quicker to hire a high-quality software engineering firm to provide the needed innovations.