Testing Perceptions : the GE Ecomagination Challenge

Our previous post underscored the influence of culture on the ills of the French innovation system. The notion lacks sharpness. Thus, before we take on the open innovation powerhouse that is the Ecomagination Challenge, we wish to pick up on some comments generated by the first post and deepen our understanding of culture, both as it applies to a country – national culture – and as it applies to organizations and businesses – corporate culture. What will appear is that GE’s foreign experience provides quite a revealing cultural perception test for the French situation.

What’s culture got to do with it?

The study of national cultures received a major boost from Geert Hofstede’s work, which situates a culture within a five dimensional axiological space. France stands out in this framework with a relatively high uncertainty avoidance value, which can be considered as a high aversion to risk. We may consider in addition Yann Algan and Pierre Cahuc’s book (in French), which shows a relatively low level of trust in French society. Both factors are bad for innovation, as pointed out by Laurent Alt, to whom we owe these references.

When it comes to corporate culture, we note that the discussion got started in the eighties mainly by two books : In Search of Excellence, by Tom Peters and Robert Waterman, and Corporate Cultures, by Terry Deal and Alan Kennedy. The notion remains in circulation to this day, as the title of the recent Booz & Co Global Innovation 1000 study shows : Why Culture is Key. Yet culture as an explanatory concept is not immune to criticisms. In a classical move, Bill Fischer’s response to the aforementioned study asserts that organizational culture is not produced by aspirations, but instead emerges as an outcome from the management system of an enterprise. To refer to culture could mean worrying about something that can’t be acted upon directly, and to neglect available real levers of improvement.

All considered, it would then seem preferable to abide by Peter F. Drucker’s maxim : “Don’t change culture; use it…”. But this presupposes awareness and real knowledge of a given culture. As a consequence, making use of this notion would then make sense when it is possible to show, based on concrete examples, how culture structures our perceptions. It is the kind of method of analysis used by Michael Lewis in his recent and brilliant book on the 2008 financial crisis. What at first appears to be anecdotal and isolated data can lead to uncovering the equivalent of hidden planets influencing the paths of our decisions. Let’s modestly try to apply his approach to the topic of innovation management : taking what people do outside of France, and looking at how we perceive it here.

The GE Ecomagination Challenge

There is a large choice of examples that illustrate how innovation is managed elsewhere. For this post, we picked a large American corporation putting open innovation in the service of sustainable development: the General Electric Ecomagination Challenge. Both a watch and investment tool, this initiative is considered by thought leader Stefan Lindegaard as a potential role model for open innovation, for the following reasons (quoted):

  • “They have a clear strategic scope that seems to be part of an overall strategy.
  • They have a strong ecosystem of partners that can help participants turn ideas into reality. This is can be much more rewarding the cash prizes for many people.
  • They offer significant prizes which by itself raises awareness among potential participants as well as media and bloggers.
  • They are developing a platform through the challenges using apps, YouTube, Twitter and other tools to drive awareness and idea generation.”

Since 2005, GE used the Ecomagination Challenge to invest over $135 Million in cleantech startups and partnerships, to which must be added one strategic acquisition. The signal they are sending appears very clear: in the field of sustainable development, there is credit to be earned from opening up your innovation.  GE faced up to the challenge of organizational learning in a competitive environment in which other players such as Siemens are also stepping up their open innovation attractiveness. It should be noted that GE used the services of innovation management specialist Brightidea to support the deployment of this strategy.

The signal in favor of open innovation sent by GE would appear to be extremely clear, as already noted above.

Perception bias – revealed

Yet for communication to work, the signal must not be filtered out by our cultural bias. You might be thinking: “In this case, no way!” – Well, it may require a Frenchman to succeed in this task where admittedly others might fail. Cue for the return of the sustainable development consultant from our first post – the one with the bleak view of the French market potential of innovation management consulting. Struck by his negative assessment, we brought up the Ecomagination Challenge case. Sure enough, our consultant knew about it – a rather hoped for by-product of his expertise in the realm of sustainable development. However, in his view Ecomagination Challenge was definitely not about open innovation – rather, its purpose was to exclusively collect ideas from GE collaborators, internally. He seemed quite resistant to the notion of openness. Sensing a larger force at play, we did not attempt to rectify this detail. If the Ecomagination Challenge was not open, it was because it could not be open. Something about the idea of openness did not sit well with this person’s value system. Certainly such an idea could not be applied to a company like General Electric.

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What lessons from the GE Ecomagination Challenge can we apply to the French innovation system? Given the problematic cultural fit of openness and France, we may have arrived at a paradox: the most urgent lesson may be that in order for open innovation to succeed in France on a practical level, it may be necessary to ditch the open innovation concept entirely… “Don’t change culture ; use it…” – So, in the spirit of Peter F. Drucker, our next post will take a look at those things that reveal the actual strengths, cultural or not of the French innovation system – including from the standpoint of foreign perceptions.

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Note : The illustration used above is licensed under Creative Commons and is available here.

 

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