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2 Changes to Electric Utilities’ Work Culture to Foster Innovation

When people acquire a new position, join a new company, or embark on a new career, they proudly announce their successes to family, co-workers, friends, and acquaintances. New employees tend to be excited about the work and full of new ideas. In contrast, seasoned employees are skeptical until they see the benefits that accrue from continuous innovation.

Over time, motivated employees become Innovation Leaders and Followers. Unmotivated employees become Innovation Resters and Assassins. Interactions with key managers and fellow employees determine which perspective each employee embraces as they perform their daily tasks.

Over the next several posts, we’ll discuss actions that every manager can introduce to encourage innovation. For now, let’s take a closer look at two changes to electric utilities’ work culture that, when implemented, will foster innovation in the workplace.

Key Managers: Embrace New Ideas

The goal of key managers should be to cultivate the skills that encourage continuous innovation. This means walking the line between foolishly embracing every new idea, and irresponsibly rejecting every new idea. It also means establishing a system to track and publicize good ideas. Tracking good ideas ensures that they won’t be forgotten before they are implemented. Publicizing good ideas allows all employees to see that continuous innovation is a priority.

Without fostering innovation, the company is unlikely to succeed in the long run, and will join the remnants of other companies that failed to innovate which litter the corporate world.

Work Culture Change #1: Share Rewards

Many companies ask employees to sign over copyrights, trademarks, patents, and other intangible creations as a condition of employment. While this rewards the corporation for the efforts of innovators, it discourages employees by providing little incentive to innovate.

A better approach would be to reward innovation leaders and followers with monetary or stock bonuses that are comparable to either the revenue stream generated by the creation, or the corporate expense to receive the patent, trademark, etc.

For example, when a group of innovation leaders and followers receives a patent that has a present net worth of $1 million, the group should receive a substantial cash bonus. When a group of innovation leaders and followers receives a patent with a net worth that is difficult to calculate, the group should receive a cash bonus equal to the corporate expenditure that was required to receive the patent.

Reward All Innovative Ideas, Not Just Profitable Ones

Many innovative concepts will not be patentable, and so the above recommendation may not be realistic for every new idea. To reward this type of innovation, companies should present and publicize smaller innovation awards on a quarterly basis. Companies should develop innovation award programs that are like national lotteries: many players with only a few big winners each quarter. Rewards should include both public recognition for service, and a monetary bonus.

An innovation award could be presented for a worker’s ability to anticipate. For example:

The week before a scheduled crane lift, Dave, the construction foreman, drove to the jobsite to verify the placement of a heavy lift crane, oversize load trailer, etc. He noticed that there was a depression where one of the outriggers would be placed, and used a length of rebar to probe the depression. Dave identified a sinkhole that needed to be mitigated before the scheduled crane lift.

In this scenario, Dave should be rewarded for his ability to find an innovative approach to test the depression and anticipate a solution before the problem occurred. Though neither action directly correlated with company profit, Dave’s foresight prevented a potentially costly accident.

Innovation Awards are Not Annual Bonuses

Innovation awards are different than annual bonus programs. Innovation awards use corporate benefit as the benchmark. The key difference is in the amount rewarded. Executives always receive higher annual bonuses because they have a higher salary than project managers. However, project managers can expect a higher innovation award than a senior executive if they pursue innovative ideas with their team.

Work Culture Change #2: Innovation as a Key Performance Indicator

Innovation should be included as a key performance indicator (KPI), alongside safety, earnings, operation and maintenance costs, and capital budgets. This does not mean that workers would be expected to have a new idea every quarter or even every year. However, this does mean that workers either strive to innovate or actively support the work of others.

By including innovation as a KPI, innovation resters and assassins could be more easily identified in the workplace. Consequences that are applied to not meeting other KPIs could be applied to innovation assassins or resters, who are unlikely to achieve the innovation KPI. By changing electric utilities’ work culture to include innovation as a KPI, innovation resters will be encouraged to participate, and innovation assassins can either participate or look for alternate employment opportunities.

How to Inspire Workers to Achieve Innovation as a KPI

To support innovation in the workplace, staff meetings should include one agenda item per meeting that focuses on latest trends and technology in the electric utility industry. Trade publications that publish competitor’s success stories, new concepts, and information about cutting edge technology can inspire innovation.

Energy storage technology, for example, is an area where innovators are working to create a method to store 20% of our daily energy needs in a safe, reliable, and efficient manner. Leaders are exploring improved battery storage, green hydrogen, and mechanical options, such as pumped water and compressed gas storage. Improved battery storage will enable energy from renewable sources to be stored until it is needed, and is vital for renewables to provide enough energy to eliminate society’s dependence on fossil fuels.

While there are several promising energy storage technologies, further innovation in this area is essential to mitigate the worst impacts of climate change. Building on the innovations of others is key to finding the necessary energy storage breakthroughs.

Investigations After the Fact Cannot Replace Innovation

Companies also need to recognize that apparent cause evaluations and root cause investigations are poor substitutes for progressive, anticipatory thinking. If construction foreman Dave had not investigated site conditions ahead of time, and the crane tipped over during the lift, an after-the fact-root cause investigation would not solve the problem.

An innovation award that encourages employees to be diligent and forward thinking would cost far less than the costs associated with the crane tipping, subsequent damage to machinery and property, and potential injury to workers. Plus, a root cause investigation would do little to erase the blot on the company’s image.

Change is Difficult for Electric Utilities

Changing electric utilities’ work culture is a difficult task, especially when so many innovation assassins can be found on electric utilities staffs. If in reading this article, you thought to yourself, this will never happen, it may be time to reflect on your own perspectives. Are you an innovation rester or assassin? What’s stopping you from implementing these changes to encourage innovation in the workplace?

To schedule a presentation on best practices for managers seeking to encourage innovation on their teams, contact us. You can also learn more about Prescient’s ideas for the next generation electric power grid by checking out our blog.

This article was written in collaboration with Prescient's Lead Editor Alyssa Sleva-Horine.

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