Harnessing the Power of Management Innovation

by Management Innovation, Sustainable Organisational Growth


Saket’s focus is on helping organisations to become flexible and adaptive, while emphasising that people in the organisation grow as well. His experience includes working with a range of organisations from large, complex global enterprises to small entrepreneurial start-ups.

The ability to innovate within the realm of management practices is more crucial than ever. Management innovation can be defined as a marked departure from traditional management principles, processes, and practices or a departure from customary organisational forms that significantly alters the way the work of management is performed. This article delves into the transformative power of management innovation, highlighting its importance, strategies for fostering it, and real-world success stories.

The Essence of Management Innovation

Management innovation is about fundamentally rethinking how the organization operates, competes, and achieves its goals. It’s a departure from the status quo, challenging conventional wisdom and traditional management paradigms. Unlike technological or product innovations, management innovation focuses on the company’s internal processes, practices, and structure, aiming to achieve a significant leap in organizational effectiveness and efficiency.

Why Management Innovation Matters

In a world where change is the only constant, management innovation offers organizations a pathway to sustainable competitive advantage. It enables businesses to adapt more quickly to market changes, embrace new opportunities, and continuously improve their operations. Companies like General Electric and Procter & Gamble have long recognized the value of management innovation in driving long-term success and resilience.

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How to Foster Management Innovation

Fostering management innovation requires a deliberate effort to challenge existing assumptions and encourage creative thinking. Organizations can start by identifying significant problems or opportunities that, if addressed, could dramatically improve performance. Encouraging a culture that questions orthodoxies and leverages the power of analogy to draw lessons from different industries or domains is also crucial. Moreover, creating an environment that supports experimentation and learning from failures can accelerate the pace of management innovation.

Real-world Example of Management Innovation: Whirlpool

Whirlpool, the world’s largest manufacturer of household appliances, exemplifies the impact of sustained management innovation. The company has turned itself into a serial management innovator, continuously introducing industry-first products and processes. Whirlpool’s commitment to innovation is evident in its development of the first electric wringer washing machine in 1911 and continues today with its revolutionary products like the 2-in-1 Removable Agitator washer. Whirlpool’s success underscores the importance of embedding innovation into the company’s culture and operations

Overcoming Challenges in Management Innovation

Despite its benefits, management innovation is not without challenges. Organizations often face impatient leadership, a lack of innovation culture, and a fear of change Overcoming these obstacles requires a clear innovation strategy that aligns with the company’s overall goals and a commitment from leadership to support and invest in innovation efforts. Additionally, fostering a culture that values creativity, experimentation, and learning is essential for management innovation to flourish.


Management in the twenty-first century hasn’t changed much since the twentieth century. Therein lies the opportunity. You can wait for a competitor to stumble upon the next great management breakthrough, or you can become a management innovator right now. In a world swarming with new management challenges, you’ll need to be even more inventive and less tradition-bound than all those management pioneers who came before you. If you succeed, your legacy of management innovation will be no less illustrious than theirs. Management innovation is not just a nice-to-have; it’s a must-have for organisations seeking to thrive in the complex, fast-paced world of today.

By embracing management innovation, companies can unlock new levels of performance, adaptability, and resilience, ensuring their long-term success and legacy in the business world.

Versatile Consulting can help you integrate management innovation in your board room, contact us to know how we can support you thought the process.

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In the Harvard Business Review article “The Why, What, and How of Management Innovation,” Gary Hamel discusses the transformative power of management innovation in creating long-lasting competitive advantages and dramatic shifts in competitive positions. Management innovation refers to significant departures from traditional management principles, processes, and practices, or from customary organizational forms, significantly altering how management work is performed.

Why Management Innovation Matters:

The article emphasizes that breakthroughs in management processes, such as the creation of intellectual property, brand building, and talent development, deliver potent competitive advantages. Historical examples include General Electric, which perfected the industrial research laboratory to win more patents than any other U.S. company, and Procter & Gamble, which revolutionized brand management. Despite these advantages, most companies focus their innovation efforts on developing new offerings or achieving operational efficiencies rather than on management innovation.

What Is Management Innovation?:

Management innovation creates a long-lasting advantage when it introduces novel principles that challenge conventional management beliefs or when it departs from traditional organizational forms. Over the past century, management innovation has allowed companies to cross new performance thresholds more significantly than any other type of innovation.

How to Become a Serial Management Innovator:

The article outlines several strategies for fostering management innovation within an organization:

  • Commit to a Big Problem: Identify significant challenges or trade-offs that, if addressed, could dramatically improve performance.
  • Challenge Your Management Orthodoxies: Question conventional wisdom that may obstruct innovation and consider alternative assumptions that could lead to fresh insights.
  • Exploit the Power of Analogy: Look for unconventional organizations and practices that might solve your problem, drawing inspiration from atypical sources.

The article also highlights the importance of a systematic process for producing bold management breakthroughs, which includes a commitment to tackling big management problems, identifying novel principles, deconstructing management orthodoxies, and finding analogies from unconventional organizations.

“The Why, What, and How of Management Innovation” argues that to stay ahead of rivals, companies must become serial management innovators, systematically seeking breakthroughs in how they execute crucial managerial processes. By doing so, organisations can cross new performance thresholds and sustain their competitive edge.

This summary captures the essence of Gary Hamel’s insights on management innovation, emphasizing its critical role in achieving and sustaining competitive advantage through novel management practices and principles.

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