By Tina Schneidermann, COO, Hot Spots Movement

It seems incredible that 2015 is already drawing to a close, but the presence of Somerset House’s famous ice rink beneath the Hot Spots office confirms it – the end of the year is upon us. As I watched the festive decorations going up and thought about content for this month’s newsletter, I decided to reflect on three of the themes that have dominated our research and thinking over the past 12 months and look at how they are interconnected.

Innovation: Innovation is a topic that seems to again be at the forefront of everyone’s minds in 2015. In fact, last month when we made it the theme of our newsletter, it turned out to be one of our most popular issues ever. Whilst we shouldn’t be surprised about the need for companies to master innovation – it is a key element in resilient and sustainable business models – it certainly reminded us how hard it is to build truly innovative organisations. What is absent from the research so far are the practical steps organisations can take in order to understand how capable the are currently, and what they need to improve in order to successfully innovate. This is a high priority for us here at the Hot Spots Movement and, over the last seven years, we’ve conducted research with more than 90 multinational companies to develop a diagnostic that provides exactly this direction. We’ve identified 17 critical capabilities an organisation must have in order to innovate successfully, including cultures of adaptability, rapid prototyping, scaling, and making effective use of feedback mechanisms. The results from our database of more than 5,000 respondents reveal that most organisations are struggling with building cultures that are tolerant of failure – an inevitability when trying new approaches – and providing their people with time to innovate.

Networks: One of the biggest discoveries we’ve made about innovation over the years is that the best ideas rarely come from the top, or even from the product development team. In fact, some of the best business ideas emerge from informal relationships and networking between colleagues – which means they rarely make it into the business plan. For us, 2015 has been about helping companies understand how they can identify and benefit from these informal networks. We’ve done some exciting work with networking expert Assistant Professor Raina Brands from London Business School on this topic, helping clients identify ways of maximising the positive effects networks can have and minimising their negative impact during periods of change. Network analysis is also helping companies identify information bottlenecks, and correctly diagnose where issues may be occurring in the business. One example that caught our attention recently was that of technology company, Juniper Networks. Juniper was experiencing issues with their client service so decided to map all the people involved in delivering for a single client account. The analysis revealed that, on average, 900 people (out of an organisation of around 9,000 employees) were involved in any one client service delivery. This helped them understand that the issue was not necessarily located within their client services team, but required a coordinated effort throughout the many functions within the organisation.

Freelancing: Focusing on innovation often creates an immediate need for skills that an organisation’s employees don’t possess or don’t have in sufficient quantity. Freelancing plays an important role here in two ways. For organisations, hiring freelancers helps them avoid getting bogged down in lengthy interviewing and on-boarding processes and provides rapid, pay-as-you-go access to the complex skill sets needed for innovation. For workers, freelancing has become an attractive way of working on the most engaging projects. As this becomes an increasingly popular option, organisations do have to think carefully about how they will integrate freelancers and contractors into their workforce. This creates huge challenges in terms of reimagining company culture so that it can encompass those who have a foot out of the door and establishing a framework for managing and measuring engagement among employees, freelancers as well as contractors. Employers will also have to think carefully about the strategies they currently rely on to build a shared sense of purpose and how to ensure this will remain sustainable as the number of freelancers in their workforce increases. It also creates an urgent need to reconsider the value proposition between employers and the many, diverse members of their workforce. Organisations can no longer rely on one universal employee value proposition when increasing proportions of their workforce do not fit into this category. Creating a compelling value proposition for temporary, freelance and portfolio workers will be imperative.