Innovative Intelligence: The Art and Practice of Leading Sustainable Innovation in Your Organization

CHAPTER TWO

LEADING THROUGH COMPLEXITY

Many executives do not recognize the need to develop innovative leaders who can lead through complexity until it is too late. Clayton Christensen was quoted as saying, “Managers are the smartest people in the world, on average [but] … are CEOs smart enough to seize the innovation moment? Their own jobs are at stake—and much, much more besides.”¹ As long as executives fail to recognize the critical importance of developing innovative leaders throughout their organizations, they will impair their capacity to respond to complex business challenges. They will also erode their competitive capability and undermine their potential for new growth.

Complexity is not a new management concern; rather, it is a predictable outcome of the shift to the current globalized knowledge-based economy. A shift of similar importance occurred with the advent of the industrial economy in the twentieth century, which introduced a complicated work environment and drove the development of new methods and processes, such as Taylorism and Six Sigma. The recent knowledge economy shift has introduced even greater complexity. This complexity is characterized by constant change and unpredictable course corrections that often have direct or indirect impacts on businesses and entire industries.

Our fundamental premise in this chapter is that the root cause of the innovation gap is the inability to effectively manage the complexity inherent in the knowledge economy. Enhancing ...