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Why Best Practices Can Lead To Better Innovation

2014 July 23
by Greg Satell

Applying state-of-the-art tools and processes is widely seen as a mark of excellence. So, perhaps not surprisingly, “best practice” is one of those terms that you constantly hear in corporate circles. Managers often see implementing them as key to their performance.

Yet many experts point out that adopting so-called best practices can stifle your ability to innovate. After all, once you designate a particular way of doing things as “best,” who is going to question it? And if nobody questions it, it won’t be improved.

Still, even keeping those objections in mind, best practices can be immensely valuable, if approached with open eyes and good sense. The truth is that much like any business process, they’re only as good as the managers who implement them. While many do use best practices as a crutch, they can also be used as a platform from which to innovate.

The Value Of Benchmarking

As a report by Accenture points out, benchmarking is an important element of any operational process. Knowing where you stand in terms of costs and value creation is essential to evaluate where you stand competitively. Without a robust benchmarking effort, you are simply flying blind, especially with regard to best practices.

But quantitative benchmarking is not enough. Simply crunching numbers gives you little insight into context and, while it can identify problems, it doesn’t lead you to any viable solutions. So qualitative benchmarking—taking into account context and constraints—is fundamental to keeping operations moving forward.

And benchmarking can help you innovate as well. In every industry, you have some areas of high variance and other areas where both performance and practices have become fairly standard. This often signals an opportunity for disruptive innovation, as Walmart and Dell showed with logistics and Southwest Airlines demonstrated with turnaround times.

Using Best Practices For Organizational Learning

Another important role for best practices is internal organizational learning. At any given time, there are various initiatives within an enterprise which lead to process improvements. Often, these are not codified, but informal best practices that arise from trial and error rather than a focused effort.

Unfortunately, these practices are rarely shared throughout an organization because they tend to be more tacit than explicit. Sometimes, they are minor tweaks and don’t seem important enough to send up the chain of command. In other cases, they are deliberately hidden because they lack official sanction and employees fear reprisal.

That’s why I’ve always found it helpful to have internal best practice programs to share learning. A monthly meeting structured around specific functional areas can do wonders to get middle managers to share ideas that would otherwise be trapped in various silos. In my experience, these are best conducted without senior management participation.

We often think of best practices as something that needs to be driven from the top, but actually most of the really important learning comes from the middle of the organization.

Playing Catch Up

Every good manager wants to pursue excellence, to try to find a way to do something that nobody else can do as well. Through years of experimentation, some smart thinking and some luck, you can hit upon new processes and practices that are measurably better, superior in terms of efficiency, effectiveness and serving the consumer.

Yet still, there are always going to be areas in which you are crap. Maybe it’s an oversight or maybe it’s because a certain aspect of your business simply isn’t a priority, but being crap somewhere is inescapable. You only have so many resources and so much mental bandwidth to devote to excellence. That’s not pretty, but it is a simple, unvarnished truth.

In this respect, the search for best practices can be immensely valuable. By employing them intelligently, you can increase your own performance in areas in which you are weak. So while it’s true that adopting best practices from elsewhere won’t lead you to excellence, sometimes it’s an extremely viable way to save you from being crap.

Working In Perpetual Beta

When Google launched its revolutionary new mail service, it did so in “beta,” which meant that it didn’t consider the service quite finished, but released it to the public anyway. It quickly gained traction and overtook the market leader, Yahoo.  Nevertheless, Gmail remained in beta for five years, long after it had achieved dominance.

That’s the value of perpetual beta. It’s hard to imagine a company like Google would have a problem with best practices, because it recognizes that “best” is a relative term. It doesn’t mean finished or even Leibniz’s “best of all possible worlds,” it just means the best you can do at the time, soon to be improved or even replaced by something else.

So the argument against best practices is a straw man and there’s no reason that we should be reticent about adopting them. What’s really important is creating a culture of change, where “best practice” is understood to be a transient term, soon to be overtaken by something vastly better.

– Greg

4 Responses leave one →
  1. July 27, 2014

    There is not much to disagree with most of the article but I still have a question. Are there really any best practices? I see a lot of consulting organizations talk about it but a little delivered at the end. Often it is always rediscovered through applications by an organization for its situation, environment and context through experimentation and can eventually become a good practice for that organization but others may still have to rediscover it for themselves It is like calling, ” Honesty is the best policy”. But to know it, understand it and follow it, everyone has to discover it for itself.

    Isn’t it like the advice given in other article- ” Dont chase the unicorns” ?

    [Reply]

    Greg Reply:

    I can see how you could get that impression, but “unicorns” are things that don’t really exist. Influentials, at least as Gladwell described them, Millennials and trying to build marketshare through loyalty are all things that are demonstrably false.

    Best practices, on the other hand, have real value. They’ve been tried and tested. There is a problem with using best practices as a crutch and that can limit innovation, but that’s not a problem with the practices themselves, but how they are managed and implemented.

    – Greg

    [Reply]

  2. July 28, 2014

    Greg, thanks for response. As I mentioned in my comments earlier, I do not disagree with the spirit of the message in article but I would like to debate the very definition of Best Practice. In my opinion there can only be (just) practices that work well for an organization but may or may not work for others. Each organization has a unique culture, unique personalities, unique way of working that may or may not be able to adopt and take benefit of a practice that has worked best for another organization. By terming it best, we are very well asking people to treat that as best and adopt as it is. This is where organizations fail to get the right benefits as they avoid rediscovering and experimenting to find their right fit. As you mentioned, and I agree, that these better be beta versions. We may have to find a better way to promote such practices. Probably measurements and benchmarks may help in articulating the real benefits rather calling these as “best practices”.

    [Reply]

    Greg Reply:

    No arguments here:-)

    [Reply]

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