Strategy & Organisational Change
REDEPLOYING TALENT
C orporate history clearly shows the power of innovation. Great ideas represent potential profits and a path to competitive advantage. Novel insights can reshape entire industries in favour of the innovator. streaming – as it was when Ford introduced the assembly line, interchangeable parts, and mass production to revolutionise car manufacturing in the early 1900s. The challenge is taking promising That’s as true for Spotify today – deploying AI and big data to dominate audio practices, wherever they emerge, and getting them to the people and places in the organisation where they can create transformation My work with Constance Helfat and Gianmario Verona takes a closer look at this issue.
We found that, rather than implementing new processes and technology from afar, it pays to take the innovation experts to the people who will be using their creation. Game-changing innovation can begin in different places across a company’s ecosystem, especially if it embraces the principles of open innovation. But all too often, good ideas that come from a R&D centre, skunkworks, or project team struggle to gain traction. One common problem is that the knowledge that needs sharing is bound up with the experiences and insights of individual employees. Codifying and passing on this knowledge is difficult. Moving the individual to a new team, project, or even country that needs their know-how may be a more effective approach. Given the costs involved in moving experienced individuals within an organisation, it is important to understand when businesses would benefit most from such a move. We investigated this question using data provided by one of the world’s largest oil companies. This amounted to 33,000 engineer assignments across more than 7,000 projects between 2004 and 2012. We gauged an engineer’s expertise with innovation by logging the number of new well-drilling technologies they were exposed to during previous assignments. We also recorded how many innovative technologies a unit used at least once during an engineer’s visit. This allowed us to compare the savings associated with the innovative technology itself, the presence of an experienced engineer, and a combination of the two. Each innovative new technology the unit used reduced drilling costs by 15.4 per cent – producing an
average saving of $44.7 million. Separate to this, an engineer’s experience of using innovate technology reduced the cost of every metre drilled by 4.2 per cent – around $12.2 million over the life of a project. This underlines the benefit of implementing innovation. However, the combined benefit varied on the circumstances at the unit. When introducing innovative
technology at a unit for the first time, drilling costs often increased as staff learned to get the best from it.
TO THE CORE
However, if an engineer with experience of using new technology was assigned to the unit, drilling costs fell. This suggests that the more exposure an engineer has to innovation, the better equipped they are to help a unit adapt to unfamiliar technology. A key factor here is that many innovative technologies are not simply ‘plug in and play’. Experienced engineers aren’t just involved in the initial installation, they help to make the required adjustments to ensure the technology meets the specific needs of the unit. However, if the unit was adopting technology that it had some prior experience of, the additional benefit of assigning an experienced engineer disappeared.
1. Innovation can provide companies with a competitive advantage, but new ideas often struggle to gain traction. Moving individuals to new teams is a potential solution. 2. This is most effective when redeploying staff to a team that is trying an innovation for the first time. 3. Target receptive employees
who have used earlier generations of a new
Is redeploying staff the secret ingredient when introducing innovative technology?
technology, or have a specific problem they have been unable to solve without the innovation. 4. Allow larger projects or teams to subsidise experimentation in smaller projects that share similar challenges to overcome concerns about performance.
by Christian Stadler
wbs.ac.uk | Warwick Business School
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