Towards a new paradigm: The social dimension and innovation in business

Estimated reading time: 8 minutes

The crisis we are currently experiencing is a crisis of paradigm, caused by a vision of companies and organizations where collective and social aspects are not relevant.

The secret to the wealth of a country lies in innovation. But innovation is a social process that requires courage, being willing to reinvent yourself, and above all, leaders who encourage the collective dimension of our organizations.

The quicker we understand and share that diagnostic, the better. But repeating the name of the medicine “innovation” over and over again is not enough; we need to swallow that pill and implement resources. The longer we wait, the more the crisis will grow.

The new basis of competitiveness: The new paradigm of the “collective” side

Our crisis is not a crisis as such, rather a change in social and business paradigm. To emerge from that crisis requires placing innovation as the main business challenge, which means finding new ways of managing talent collectively.

The new paradigm involves speed, it involves understanding that what we know about the past will help us little in predicting the future. Success will be for those organizations that can learn, relearn and reinvent themselves the fastest.

Reinvention involves collective learning, having the courage to change, and this requires great measures of leadership that favors collective change.

The new paradigm involves complexity in a world where expiration and information surplus are unmanageable and that demand new ways of making decisions and a new type of leader who knows how to create collective environments, where the best decisions are made fast, that do not come to a standstill with the complexity.

The new paradigm has become a management revolution, which is jacked up by technology. It’s a revolution of values that speaks of commitment, transparency, collaboration, meritocracy, creativity and talent as the new bases for innovation, but above all, that requires a new type of leadership that understands the social dimension of innovation, its collective dimension.

Anchored in the paradigm of the individual

The door to economic wellbeing, to emerging from the crisis, involves moving forward towards new destinations, proactive innovation or “changing things even when they work well before others do” in companies, social institutions and public administrations. However our leaders and employees still act in line with old paradigms. Our political leaders, our institutional leaders and our business leaders were born and brought up in institutions, administrations and companies created for another more stable, predictable paradigm where they have been socialized in antiquated norms and cultures.

The economic crisis, the financial crisis, the institutional crisis is a management crisis and economists and politicians are not usually experts on this subject. The main difficulty in emerging from the crisis is a problem of “non-adapting” reference framework and expired cultural values that affect us as a society, but that especially affect our business leaders who should act as driving forces of change.

Leaders are usually the reflection of the culture of our companies and society. Social change sparks a leadership change and leadership in turn causes social change. An equation that needs to be continuously rebalanced.

The change of our leaders will happen out of the need for regeneration, for reinvention, for transparency, to understand the new paradigms, due to the cultural change of our institutions and companies: we urgently need leaders who quickly forget the rules of the past.

The role of the leader as a driving force for a more collective leadership

Often our leaders are not part of the solution, they’re part of the problem. Instead of promoting new values and new ways of management that generate wealth, they try to apply old solutions to new problems: they request more effort, they don’t ask for more intelligence or creativity; they ask for more discipline and order instead of giving more flexibility.

New ways of understanding business, human talent, the role of commitment, creativity and the new values are the solution for an economic dynamism that promotes innovation.

It’s about favoring social and economic environments that encourage new entrepreneurs and leaders. Business environments where the collective and social side are more important.

Innovation is the business challenge of our century; it is a social process. Leadership is becoming one that promotes the collective aspect and collaboration. Individual talent is necessary but insufficient in itself: creativity and innovation are processes based on conversations, intelligence is becoming more collective, the we needs to be revaluated over the I. This is the major change in our organizations.

The role of leaders is calling for change, giving more protagonism to social and collective mechanisms in the company. The role of the leader as a driving force for change is fundamental in creating these new innovative environments where the main mission of the leader is to lead others, to create more leaders, to generate learning, intelligence and collective decision in our organizations (businesses, public administrations and social institutions).

Generating wealth is something done from the company, by the entrepreneurs, by the public administrations and institutions, and if the nature of the rules of management, if the management is based on the past, the so-called crisis is set to continue.

Will we have leaders to act as driving forces of change? How do we encourage the change?

Virginio Gallardo is Director of Humannova, a HR consultancy specialized in helping lead innovation in companies and manage the organizational transformation. He is author of the book “Liderazgo transformacional” and coordinator of Liderazgo e Innovación 2.0. This post was originally published on Supervivencia Directiva where you can follow his thoughts.