How to bring an innovative mindset to a board as a NED or Advisor to foster rapid growth
Scaling a company into a large enterprise is a significant challenge, even in countries, like the UK, that provide strong foundations for startups. Entrepreneurs, consultancy and governments identified that business ecosystems, notably in Europe, fail to adopt innovation and diffuse it effectively across sectors. This reluctance hampers productivity, economic expansion, and global competitiveness.
For this reasons, non-executive directors (NEDs) and board advisors are increasingly expected to bring an innovative culture and encourage a mindset that embraces innovation, especially those with a background in innovation and have a network of entrepreneurs, innovators, and investors.
As NEDs and board advisors are in demand for their ability to bring a cultural innovative mindset then it is important that NEDs and board advisors know how to do this.
1️⃣ Challenge assumptions and encourage disruptive thinking
As mentioned above, innovation does not emerge from maintaining the status quo. NEDs must bring an external mindset that challenges embedded assumptions. For example, they may:
- Advocate for the recruitment of experts with diverse backgrounds, ensuring fresh perspectives contribute to debates. This very much means recruiting from outside the sector to bring a new mindset and learn from what happens well elsewhere.
- Encourage board members to explore industry disruptions and emerging technologies. Not just looking at what is available now (the probable innovation) but the innovation in development on the horizon in the longer term (the possible innovation).
- Push leadership to reassess business models and their approach to innovation, to question whether current strategies maximise innovation in line with their business plan.
2️⃣ Leverage networks to connect boards with innovators
One of the assets a NED and board advisor may bring is their network. Boards may seek candidates with strong industry connections, as these relationships can open doors to investment, partnerships, and commercial opportunities. By doing this NEDs and board advisors bring tremendous added value by connecting the executives with innovation pioneers, form partnerships with other businesses, consultancies, universities, and tech incubators.
By integrating external expertise into board-level discussions, NEDs help businesses adopt best practices, explore new markets, and remain at the forefront of industry innovation. For this reason, NEDs and board advisors who have “been there and done that” are seen as valuable to businesses seeking an external expert.
3️⃣ Do not take the easy route and conform
It is common for businesses to focus on benchmarking against competitors, but this can limit innovation.
NEDs and board advisors can facilitate a culture where companies should develop unique strategies that set them apart by looking beyond standard industry practices and explore unconventional approaches, promoting differentiation rather than replication, and supporting executive teams in identifying untapped opportunities.
4️⃣ Cultivate a risk-tolerant environment: making mistakes is part of innovation
Innovation requires experimentation, and experimentation inevitably involves failure. Some companies avoid taking risks due to fears of financial loss or reputational damage. However, the world’s most successful businesses have embraced trial and error as essential components of their growth. A NED and board advisor with a successful record in innovation is key to bringing this much needed mindset to instil confidence in experimentation. By reinforcing the idea that failure is a valuable learning process and a route to discovering the truth will give confidence to the executive team, which will inevitably flow down the business to the workforce leading to an organisation comfortable with innovation.
5️⃣ Influence investment in innovation
Businesses that allocate capital and resources to experimental projects foster continuous development and the risk taking needed to innovate. NEDs can play a pivotal role in influencing this by:
- Advocating for dedicated R&D budgets that allow employees to work on innovative ideas.
- Highlighting their own experience and successful case studies, such as 3M and Johnson & Johnson, who allocated time for engineers and scientists to experiment. These initiatives led to successful global products like the Post-it Note and baby shampoo.
Conclusion
Innovation is essential for businesses seeking growth and it requires leadership from NEDs and board advisors with the track record and influencing skills. For all those who are sceptical and say the time is to consolidate rather than risk innovate whilst the economy is bad should bear in mind that some of the greatest innovations were brought to market during the Great Depression – none more so than sliced bread!
To find out more how to balance innovation and governance, we invite you to watch the replay of our webinar:
To go further, we invite you to watch the exert interview of Betsabeh Solente:
About the author, Thomas Harrison: Tom delivers social value and strategic growth plans as a NED, Board Advisor, and a consultant by helping established and scale up companies adopt innovation, attract investment, and enter new markets. Multi sector and European wide experience in transport, water, health, defence, nuclear and consumer goods.
