Thinking about the many entrepreneurs I’ve met, to be successful, you have to truly love your business. Good business is about caring about and paying attention to every aspect of your business, and all of its stakeholders.
Warren Buffett, the super successful investor of Berkshire Hathaway, was once asked: “What’s the secret of your success? He replied “I personally meet the CEOs of potential investees. I look into their eyes and I try to figure out whether they love the money, or they love the business. Everybody likes money. If they don’t love the business, I can’t put that into them. We count on people loving the business. Then my job is to make sure that I don’t do anything that in effect kills that love of the business.” (1)
That said, does love really go together with business?
I believe that love is to business what grapes are to wine!
The word “love” can mean many things. In a business context, I’m referring to values such as care, empathy, authenticity, purpose and compassion. Of course, a business exists to make money and grow shareholder value, but there are many ways to go about that. It’s a choice. In my experience, businesses that value “love” in the way that I’ve defined it above, are more financially successful in the long run (that said, there are exceptions).
Robert Haas, Chairman and CEO of Levi Strauss & Company, said “What we’ve learned is that the soft stuff and the hard stuff are becoming increasingly intertwined. A company’s values — what it stands for, what its people believe in — are crucial to its competitive success. Indeed, values drive the business.”
I recently ran a workshop for a group of entrepreneurs, and I asked them why they might believe that love is important in business and some of the answers included:
· Love is sustainable.
· Love is a driving force.
· Love means connection and empathy.
· Love makes things grow.
· Love puts the value into the people and the work.
· Sustainable entrepreneurship means loving your customers.
Steve Farber, author of Love is just Damn Good Business (2), cites Stephen Klemich and Mara Klemich, who has a PhD in Clinical Neuropsychology. They led a team that spent nearly 20 years researching what drives effective behaviours in organisations (3). They found 16 key thinking styles – eight ineffective and eight effective. At the heart of the eight ineffective thinking styles are pride or fear, both of which are ‘self-promoting’ and ‘self-protecting’. They are at the root of behaviours characterised as sarcastic, controlling, easily offended or dependent. The eight effective thinking styles are rooted in ‘humility’ and ‘love’. They concluded that these styles are authentic and reliable, and create personal growth, encourage others, demonstrate compassion and lead to growth in others. Again, all related to love.
The culture of love
Love in business can be about rewarding the people who make up the company and creating a culture in which innovation can flourish. It’s about pulling everyone together in a spirit of partnership. One of the businesses that I started and grew was based on this ethos. Part of this was done by implementing a share trust and a bonus scheme for all team members so everyone got a share of the profits; this information was shared openly at quarterly townhall meetings. Every member of the team from the board to the receptionist felt appreciated and valued, which was reflected in their work.
Although creating and implementing these initiatives was time consuming and costly, it garnered shared values (“love”) for the business across the entire team. When I sold the business, everyone gained. I’m particularly proud of this example of love in business which follows through to today, as many years later I’m still in touch with some of the employees; they still remember the company and the share trust and bonus scheme. Ultimately, it is about creating a positive experience for all concerned.
Another good example of a well-known business that implements this kind of practice with great success is John Lewis and Partners. Check out there values here.
Making difficult decisions and acting on them is also an important part of love in business. For example, there are times when a person may no longer be the right fit for the business, and it’s time to part ways.
This kind of decision has to be genuinely good for the business. Although such decisions are tough for all concerned, the individuals can still be treated with respect and care. With this in mind, I believe it’s important to treat the individual fairly, aiming to equal or exceed legal requirements; this will result in the best (or least bad) possible outcome for everyone concerned, as well as enabling the business to grow, innovate and prosper.
What’s the relevance of all this to innovation?
Firstly, let’s check we’re on the same page when it comes to the definition of innovation:
According to the Organisation for Economic Co-operation and Development (OECD), there are four types of innovation (4):
· Product innovation: A product or service that is new or significantly improved. This includes significant improvements in technical specifications, components and materials, software in the product, user friendliness or other functional characteristics.
· Process innovation: A new or significantly improved production or delivery method. This includes significant changes in techniques, equipment and/or software.
· Marketing innovation: A new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing.
· Organisational innovation: A new organisational method in business practices, workplace organisation or external relations.
So, innovation does not necessarily mean the light bulb, the wheel, or the iPhone, although that’s great when it happens. Innovation can mean finding a new way to decrease debtor days (the average number of days a business’ clients or customers take to pay), or a new way of delivering products or services.
Start thinking about what innovation means for you and your business, to embrace innovation. When I asked my group of entrepreneurs what innovation meant to them, they came up with a number of interesting answers:
· Finding alternative solutions to challenges or problems.
· It's beyond new ideas for me. It’s entirely about new and exciting concepts and solutions.
· It’s creative destruction or disruption.
· Broadening your horizons and thinking differently.
· Changing the lens to create new behaviours and get others to do the same.
· Innovation is like finding a light switch in the dark.
How do you create a culture of innovation in your business? It means creating a safe environment for your team to come up with new ideas, without fear of being criticised or reprimanded. To put it another way, the opposite of love is fear. If there is a prevailing culture in an organisation in which people are afraid to speak up, nervous about being criticised or reprimanded, there’s no way in which innovation will take place.
Innovating for success
I’d like to share a personal example of innovation in a business that I co-founded. It was and still is a very successful business called Turbosound, which designs and manufactures professional audio equipment; amazing artists such as Pink Floyd, Michael Jackson, Paul McCartney, Abbey Road, BBC, Oasis, David Bowie, and Dire Straits have used the equipment. After scaling the business over 10 years, we sold the company in a trade sale. Eight years later, after involvement with another business, I decided to buy ‘my baby’ back. But I did no due diligence, it was a heart over-head decision. I soon realised the company and the industry had changed. In the intervening period under other owners it had developed a fear and control culture, with little or no innovation taking place.
Over time, with much focus and attention, I changed the culture. I encouraged brainstorming sessions with blue-sky thinking, in which people weren’t afraid of being shot down for their ideas. We dedicated a huge amount of time to innovating, and as a result developed some incredibly innovative products that were patented and were a huge success. If we hadn’t given focused time to innovation, we wouldn’t have been able to turn the business around and enable a new company sale a few years later (for more, click here).
Shelly DeMotte Kramer (5), a leader in the innovation domain, identified six ways leaders can build a culture of innovation (6):
1. Embrace a multi-faceted approach to innovation, starting at the bottom.
2. Empower your employees and they’ll provide value in new ways.
3. Understand that failing is OK.
4. Choose your approach to innovation metrics wisely.
5. Don’t be afraid to take action — and quickly.
6. Learn from the past and look to the future.
7. The burning house: as a bonus tip, consider the ‘burning house’ scenario. If your house was on fire, what would you grab as you ran out the door? Now apply it to your business: what would you want to take with you if it all came crashing down? I’d grab the ability to innovate and to inspire innovation in my team — that’s the foundation for growth, the difference-maker, the special sauce.
She concludes by asking: “What would you take? What does innovation look like in your organisation? Are you approaching it as an idea factory you only visit on occasion, or have you embraced innovation as a strategic imperative? Can you think of any additional ways that you can create a culture of innovation other than those I’ve mentioned above?”
Be Aware of the Barriers
It’s one thing to acknowledge the importance of innovation in your business, but it’s important to recognise the barriers to innovation. According to the entrepreneurs I spoke to, they thought the barriers of innovation could be:
· Fear of failure.
· Trying to do too many things at once with limited resources.
· Lack of capabilities.
· Time pressures.
· Lack of vision.
· Short sightedness.
According to the Lucidity survey of SMEs in 2018 (7), it’s actually lack of time that is the biggest barrier to innovation.
That said, I believe all of the issues listed above contribute to a greater or lesser extent to preventing or slowing down innovation. Each one can be overcome using various strategies, but that’s the subject for another article!
I absolutely get that many entrepreneurs may be uncomfortable using the word ‘love’ in business. If you don’t want to, don’t! The key point is if you’re serious about creating a culture of innovation in your business (whether it’s an SME or a corporate), exhibiting and espousing the values I’ve referenced above, will foster the best chance of innovation taking place in your company. As well as running a company filled with excitement and joy. Two of the main ingredients of love!
1 Warren Buffet, on love in business: https://www.youtube.com/watch?v=KCUL00-8dCo
2 Steve Farber, Love is Just Damn Good Business: https://www.stevefarber.com/books/
3 Stephen and Mara Klemich: https://heartstyles.com/stephen-and-mara-klemich
4 OECD defining innovation: https://www.oecd.org/site/innovationstrategy/defininginnovation.htm
5 Shelly DeMotte Kramer: https://www.linkedin.com/in/shellydemottekramer
6 Shelly DeMotte Kramer article: https://talentculture.com/6-ways-leaders-can-build-a-culture-of-innovation
7 Lucidity survey: https://smallbusiness.co.uk/time-biggest-barrier-innovation-2542476
If you would like to have a conversation about creating an innovation culture in your business, I'd love to hear from you. Just fill in your details on the Contact page and we'll arrange to speak.
Hot off the press! Come and attend my free webinar "Love Business. Embrace Innovation!" at 9.30am UK time on Thursday 19 November 2020. For details and registration, see http://bit.ly/lovebusinesswebinar.