It’s the unintended consequence of thoughtfully designed leadership development programs when they’re applied to a function that doesn’t work like all the others; innovation. The reason leadership development programs don’t play well with innovation is simply because of timing. Leadership development, and most organizational incentive systems, run on much shorter cycles than innovation.
Innovation can run on decade-long timelines. Leadership development programs run on 18-month rotations. That gap is why corporations fall behind competitors, lose momentum on key projects, lack sustained focus to develop competitive advantages and see their best innovators leave.
3M’s Post-it Notes took 12 years from concept to market. Apple’s iPhone required nearly a decade of sustained investment. Neither of those products would have survived an executive rotation cycle that reset priorities every two years.
Leadership development is designed to reward high performers with advancement and new challenges. It means innovation is often lead by a functional leader who was successful somewhere else in the company and innovation is their latest challenge along their path to greater and greater responsibilities and rewards.
In practice it is far more to blame for corporate short term thinking than quarterly investor reports. Because, when a new leader inherits an innovation portfolio, none of them are theirs. And, an inherited project is almost always a career liability — too far along to kill without cost, not far enough to guarantee a return, and its success is likely to be attributed in some amount to the leader who came before.
The rational career move is to launch a shiny new early-stage project the leader can claim as their own. They launch it, collect the credit for vision and ambition, and rotate out before delivery. The risks, delays and hard compromises land on whoever holds the role next.
This is totally rational behavior inside an incentive system that is not optimized for innovation.
The result is a hyper-focus on incremental short-term wins and large, exciting breakthroughs that inflate the function’s NPV. The middle ground, those high-value 18-month projects I described here, are too risky and have no ROI for a leader who is going to, hopefully, be elsewhere when they’re launched and, in the competitive world of corporate ladder-climbing, fear the next leader will get unearned credit.
The companies that get this right change the incentive systems. They tie part of a leader’s performance review to outcomes that materialize after they’ve moved on. They build innovation boards and governance structures that outlast any single executive. They measure leaders on what reached market, not what got launched.
Leaders F-Up innovation when they promote rising stars in and out of the function without regard for continuity.
📖 How Leaders F-Up Innovation by Marc Drucker
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