Employees have unique insights into their organisation’s practices. Every day they are involved in the frontline of all kinds of processes; speaking to customers, fixing things, going through internal procedures. ‘Frontline employees’ therefore see many opportunities and problems that managers do not. This makes them a valuable source of otherwise untapped ideas. A recent study of frontline employees found that over half of employees have ideas for both improving processes (reducing costs) and improving customer experience.
For any business processes and customer experience are of strategic importance. Employee ideas therefore have the potential of playing a crucial role for performance and competitiveness. This strategic importance is further underlined by the fact that employee ideas are particularly sought in industries with the highest levels of competition, such as retail, aviation and telecoms.
British Telecom has been one of the early adopters of large-scale idea schemes in the UK. In four years, the country’s largest telecoms provider reportedly saved more than £150m (€180m). At British Airways, employee suggestions have unlocked cost savings worth the fuel cost of 550 flights from London to New York. Most famously, retailer Amazon came up with Amazon Prime thanks to an internal engineer’s suggestion of running a paid-for membership scheme in exchange for free shipping.
These are flagship examples for employee idea schemes, illustrating the potential of employee insights. Most companies, however, struggle with their idea schemes. The reality is that a fair share of companies with thousands of employees tend to source just about 150 or 200 ideas a year. In general, only a small share of submitted ideas will qualify for implementation. Therefore, whether a company sources 200 or 2,000 high quality ideas makes a crucial difference.
Why do many idea schemes underdeliver?
There is a tendency of blaming corporate culture for the failure of idea schemes at specific companies. This claim, however, constitutes an easy excuse that hasn’t actually been substantiated. As established above, most employees do have ideas and, according to research recently published in Harvard Business Review, nearly 90% of employees are eager to share these innovative ideas. Why then would large companies end up with only a couple hundred ideas per year?
A big part of the answer lies in how idea schemes work. Most idea management software are standalone single-purpose apps; they are detached from the communications channels employees use on a daily basis. Employees will have to download the app, register on the app and then learn the app. Only once these steps are completed will she or he be able to submit ideas. In this ‘adoption journey’, every step represents additional friction. Given that submitting ideas is at the discretion of employees, many will not put up with that and drop out.
A case illustrating this phenomenon well is that of a UK public sector body which recently publicised data on the adoption of its ideas scheme. More than 9,000 employees were invited to participate in the ideas scheme. Less than 20% went as far as to download and register on the ideas app. Of these people, a fifth went so far as to actually submit ideas. In relation to the total number of employees invited to participate, less than 2% submitted ideas. This organisation with more than 9,000 employees ended up sourcing 140 ideas in an entire year.
Enterprise Social Networks for Idea Schemes
Employee idea schemes are collaboration efforts that are not part of employees’ job descriptions. Gartner suggests that collaboration tools cannot be imposed on employees in the same way as traditional software. Since contribution is at people’s discretion and since they are generally busy with their daily responsibilities, any engagement barrier—such downloading, registering on and learning the app—will radically reduce participation. This is why, according to Gartner, 80% of collaboration tools fail as employees simply do not opt-in.
As engagement barriers need to be minimised, the most promising way of sourcing ideas is using a channel most employees already use. Today, the one open channel most enterprises run is enterprise social networks. Employee idea campaigns can be run in dedicated groups on these networks. All the employees have to do in order to participate, is joining a group and they are ready to go. This ease of participation is why idea campaigns on enterprise social networks gain up to 10x more traction than on standalone apps.
Whereas most standalone apps help large firms source 150 to 200 ideas per year, at Sideways 6—an employee ideas platform sourcing through Yammer—we’re used to see companies source the same number of ideas in a single month. In the long run, this approach will become mainstream. A recent evaluation by McKinsey of the evolution of organisational approaches to social technologies suggests that, in the coming years, social networks will evolve into a channel for crowdsourcing strategic insights:
About the author:
Armin Kammerlander is business executive at Sideways 6, an UK-based employee ideas platform that connects to Yammer to source, analyse and manage ideas. For more of his articles, go to sideways6.com/resources.