Australia needs a massive cultural shift on human capital

Hubs, incubators and start-ups are all phrases looming large in the innovation policy sphere right now but you have to ask, who is in on them?

The most disruptive thing you can do for innovation is to mix things up on the people front. That means different genders, racial backgrounds, sexual orientations, ages, ways of thinking and disciplines.

Diversity matters because the more different lenses you can bring to complex decision making and developing new products and services, the less likely you are to get blindsided.

The Australian government's $A1.1billion innovation policy statement was an important circuit breaker for innovation in Australia.

It promised a systemic approach to tackling shortcomings across four areas: support for startups and venture capital funding, the risk taking policy regime, boosting collaboration between business and universities and developing and keeping top talent.

It is in the latter two - collaboration and human capital where Australia needs a massive cultural shift.

TOO MANY MEN

Scratch the surface of Australia's risk-averse innovation culture and you'll find it suffers the 'too many men' problem. It's a pretty much impermeable wad of Anglo blokes used to doing things a certain way, who wouldn't know what collaboration really meant if they tripped over it.

here's also a huge dearth of the basic management, communication and information-sharing skills required. For Australia's chief “disruptor", Malcolm Turnbull, it's the kind of mining boom Australia really needs - one that digs deep to put its all its talent to work.

As we show in New Women New Men New Economy(Federation Press), getting agile and boosting innovation has to start with increasing gender diversity.

Organisations that include more women in leadership roles perform better financially, they innovate and solve problems better and they get closer to their customers.

We show that if you don't find ways to get women in on the conversation you aren't innovating adequately or looking after the best interests of shareholders. Organisations where women do well create the kind of cultures that help people collaborate more, innovate faster and more readily adapt to rapidly-changing operating conditions.

The data is so strong you can no longer get away with the argument that your situation or organisation is different or that it's too hard. Ignoring it is plain stupid.

Credit Suisse studied 3000 companies in 20 countries over four years and found organisations with more women in leadership showed a 27 per cent higher return on equity and 42 per cent higher dividend payout ratio.

“There's a strong out performance of companies that have women in management," said Stefano Natella, Credit Suisse global head of equity.

And there's an even more compelling figure. McKinsey & Co recently found companies with higher levels of racial and ethnic diversity were 35 per cent more likely to have financial returns above the median.

“We live in a deeply connected and global world, it should come as no surprise that more diverse companies and institutions are achieving better performance," said McKinsey's 2015 Why Diversity Matters report. It argues that most organisations, (including itself) must do more to take full advantage of the opportunity that diverse leadership teams represent.

“That goes for talent pipelines: attracting, developing, mentoring, sponsoring, and retaining the next generations of global leaders at all levels of organisations."

All the research tells us the current default is shaped by assumptions that restrict leadership roles, access to capital and opportunities for women.

After examining research and case studies from around the world, we honed down four dimensions that you need to factor in to help innovation flourish in context your competitive strategy. (We also examined the critical interaction between individual behaviours, organisational systems and knowledge sharing.)

We think of it as a kind of CODE, a handbook for an Agile Australia.

CODE FOR THE NEW ECONOMY

Creativity ignites competitiveness in a world where talent and ideas rival capital as a driver of innovation and growth. It is now a core competency for business success.

There are simple steps as leaders we can take to create environments where people can think, plan and act with imagination. Creativity is not some special gift but is a team sport.

In an Open world, there's no place to hide. When things are moving fast and disrupting business as usual, you need to open up and share knowledge and ideas to accelerate innovation.

It's fine to say we need to collaborate more but we still have a couple of generations of bosses and managers with little clue how to make the connections and cross disciplinary partnerships that go with it.

“How did you go bankrupt?" the character in the Ernest Hemingway novel was asked. “Two ways: Gradually, then suddenly," was his reply.

Diversity boosts performance and problem-solving. Diversity is now a 'must-have' thing for business success, not just a 'nice to have' one.

Increasing the number of perspectives on new services, products and problems leads to better outcomes. Look around at the people in the room and at the table: if they pretty much all look the same, you are missing vital cultural intelligence that will help your organisation adapt. You need to get comfortable with mixing it up.

Equity creates thriving teams and communities that build long term value. Research underpins why win-win is beating the traditional I-win, you-lose mindset most managers have grown up in.

Think of equity as being fair to employees, customers and the community - and that means the generations to come. No matter how tough the negotiation, you need to find the-win win.

Smart leaders now realise diversity doesn't happen, you have to design it in. That's especially the case in a corporate world still gummed up to the max with gender and racial inequities and stereotyped mental models which suffers deeply from delusions of merit.

WHO GETS THE TAP ON THE SHOULDER?

Australia's elite economic agency Federal Treasury always imagined itself a collaborative, collegiate type of place. When secretary Martin Parkinson got his team to look at the data and hold focus groups with staff he found it was internally competitive and the nature of the policy discussions were overtly masculine. The men got the taps on the shoulders and the development opportunities.

“That's what made me start to think, what is going on here?" he reflected later, becoming a powerful advocate for gender equality through Australia's Male Champions of Changeprogram.

Google is among hundreds of companies now methodically addressing the systemic and behavioural blocks to diversity through hiring, promotion, pay and performance evaluation.

The company's training materials on the role of unconscious biases created and reinforced by our environments and experiences, start with the warning - we're all just a bit sexist and a bit racist, we have to work through that.

“Combatting our biases is hard because they don't feel wrong, they feel right," writes Google's head of people operations Laslzo Bock in his blog, “You don't know what you don't know".

In Sydney, Taiwanese-born Telstra executive Jeffery Wang, who runs the Professional Development Forum, says leaders need to start to value cultural diversity.

“People don't fit neatly into boxes," he says. “A truly inclusive culture creates an environment where people from all sorts of backgrounds and ways of thinking can contribute. That doesn't just happen by itself."

When it comes to getting Australia out of the innovation stall zone and into the #ideasboom, we need to focus less on the fish and start talking about the water.

Australia suffers a drought in venture capital but barely 4 per cent of it is invested in women, even though the proportion in new businesses is 50-50. Those numbers alone tell you plenty. Start-up hubs and incubators like Fishburners, Stone and Chalk and Blue Chillt are belatedly starting to ask “where are the women?"

Any serious go at sparking Australia's start up culture needs to create an environment that puts our rich diversity of human capital to work. To kick start Australia's #ideasboom, first we have to outgrow the era of #stupid.

Published Dec 15, 2015, ANZ Blue Notes  Narelle Hooper is co-author with Rodin Genoff of New Women, New Men, New Economy: how creativity, openness, diversity and equity are driving prosperity now (Federation Press).

SPACE RACE

WOF: We spend about 101,760* hours of our life at work in a lifetime so let's pay more attention to the spaces in which we work

 Where do you work? It could be a construction site, a shop, a factory a field or a hospital, but for a large chunk of us these days wherever that is, it is somewhere where you sit at a desk, speak to a some people and push some things around a screen.

We know technology has blurred the lines between the worlds of work and non work and expanded our labours into the gaps and moments in between. Work is still where we collectively tend to spend more time and expend more effort than anywhere else. 

So its odd when you think about it that in our ongoing efforts to squeeze out more productivity and performance, we rarely give thought or attention to the all important spaces in which we actually do our work in. 

In The Office: a hardworking history, Gideon Haigh relates the early archaeological evidence of office work in 2000BC Egypt. It took modern communications like the telephone to convert offices from places of work to places of power. Mobile technology has made it possible to do pretty much anything anywhere but our workspaces still hold the place of power.

The cubicles? They came later, a child of 1960s Herman Miller post-industrial design, intended to inject an element of privacy and wellbeing but leaped on, in predictable fashion by the bean counters and taken to extremes. OMG the torture it has visited upon millions.

We now know that cubicles (about 10 sq mis the Australian legal minimum) are bad for us, just like we now know that sitting down all day slogging away at your workstation can kill you. 

Cubicles are a special form of post industrial hell that defy all psychological and productivity logic. They've maddened millions, plunged us into subterranean scheming and battling to escape to the corner office, or left us cowed, desperate to escape particular shades of nihilistic grey and suck up salmon that make you want to heave. 

I can't think of a good thing that's come out of them (ok, except maybe for Dilbert and The Office).  

Free Range

More recently we've hit on the era of Activity Based Working which was supposed to get people out of stuffy offices and away a regular desk. This supposedly provides workers with more freedom and opportunities to bounce around ideas to help us channel our creativity and get all 'agile'.

If you've been around the block a few times you'll know that ABW seems suspiciously like open plan and hot-desking only with acid citrus couches and weird little collaboration nooks. 

Introverts and corner office types tend to struggle here but apparently that's how millennials and tech dudes like to roll. And with savings of up to30% on office space, the bean counters have become big fans too. 

But while the spaces might look a bit funky and you can write on the walls, it can be so depersonalising its like some bad joke they play on battery chickens. 

Workers go "free range" - i.e. regular workstations or offices are banished. They lug their stuff from banks of lockers each day, supposedly let out to roam, free to do their toil.

And in clean desk policies gone mad, many organisations ban personal stuff like family photos, food or footy colours. That leaves the lurking suspicion that, come a day, you'll get terminated, disappear overnight and no one will miss you.

Creatures of human habit, craving connection, this serves to alienate us into mere knowledge slaves, homeless, aimless and, increasingly anxious.

Its like we're slicing and dicing our humanity into ever tinier pieces to fit the wheels of the productivity machine until eventually, all that's left are tiny little atoms and poof! one day, somehow your soul has evaporated.

Now we know better and it is high time we consigned the fads and architectural fantasies to history, and started with a fresh design sheet. Not jamming humans into containers but making our work spaces more fit for humans.

We need to think actively about the spaces, how they impact our senses and the emotions and behaviours evoked as we come together in within those spaces.

Natalie Slessor, general manager of workplace and change with global construction and infrastructure company Lendlease says we now have a clearer picture of what does and doesn't work at work, and what best practice should look like. 

Turns out that to really work, our work spaces should look and feel more like our home.

Ask people want they want, says Slessor and they say: ‘I want a workplace that doesn’t feel like a workplace'. 

"What they usually mean is they want a work environment that feels authentic, even homely, not clinical or manufactured.”

An environmental psychologist who loves her work humanising our work spaces, Slessor says if we want to get the best out of people at work, we need to start from our human needs and work outward.  

Slessor was part of a team who had the task of reinventing LendLease's work space for around 2000 staff out of its global workforce of 12,000. This acknowledges the fundamental influence of the "built environment" on how we come together and feel.

"The built environment and specifically the work place has a deep connection to how people feel about the business and performance people offer," she says.

"For example, if you could build a hospital that could heal people quicker, just by its very design, of course you would. If you could build a school that would help accelerate learning, you'd do it too. So would you build a workplace that was better you'd do that. It made us ask what is our workplace really for?" 

Lendlease wanted to create a workplace that brought people together."In a world where you can work anywhere, we need to create a place that does something that tech doesn't, which is create really human connections and create a community of practice which is what every business is." 

"There was an opportunity to park everything we knew and just bring back the bits we really loved, that we really felt over time had worked."

That meant simple, low stress, getting rid of the "free range" and ensuring teams had a home but flexibility to shift as tasks required. Health and wellbeing were central, an extension of the company’s safety culture.

So they put the kitchen in the middle, where everyone uses it, just like the home. Teams have set "kitchen tables" (standing or sitting) where everything happens, lockers right next to them and quieter zones for intense concentration and more relaxed spaces to move your body in. 

The company did a pilot first at its old offices then adopted the changes in the layout for its new Sydney offices at Barangaroo. It is now rolling out changes through the business. 

In case you think all this is just for cushy office types, the company has used the principles on some of its construction site offices. "They've been really well received,” Slessor says.

So what works? Slessor has helped us narrow down the four basics you need to incorporate to create more human spaces:

Nature rules: natural light, fresh air and plants make the difference. People do their best when they can see outside and aren't frozen, cooked or stifled, are close to plants (real ones not plastic) and can breathe something roughly approximating to fresh air. There's a word for it -  biophilia (our innate tendency to seek out connections with nature). Find ways to include natural materials.  

Autonomy: give people a sense of control and choice wherever you can. Even if its simple things, like colour, art, type of furniture, even simple things like start later or earlier or work from home or a cafe some days. (And yes even in the sometimes challenging phase of getting employee input on a redesign.)

Cohesion: you want to create spaces and a work environment that is low stress and easy to be in so it makes it easy for people to come together. NB - you need to balance cohesion with autonomy. Too much autonomy and you start to lose cohesion.

Chaos: allow a little chaos, mix things up. It creates a spark. Maybe invite customers in, your kids, slash duration of meetings and hold them somewhere different - the cafe, outdoors, standing up, walking! This maximises opportunities for chance conversations and allows ideas and other creative "grit" to circulate better.

Most of us don't have the luxury of big corporate budgets but Slessor offers a reality check for the bean counters. 

Lots of people try to skimp on space and facilities to try to save money but that's nuts. Its false economy.

"Ten per cent of costs are in the work place and 80% are the people. If you try to squeeze them then you are disadvantaging the remaining 80%. It doesn't make sense," she says.

Good human design and doesn't need to blow the budget - in fact it can save you heaps and boost the bottom line over time. 

Get a few people together from across your organisation to think of a few workspace 'hacks" as a start.

And lots of people don't even get those basics right. A recent Human Spaces report -The Global Impact of Biophilic Design in the Workplace asked 7000 workers in 16 countries for their experiences. The first global study on workplace design and its impact found that people who work in environments with natural elements reported higher wellbeing, productivity and creativity than those who work in environments devoid of nature. 

But nearly half had no natural light and nearly 60% had no plants.

Ultimately, Slessor says we need to diversify where people work on a city scale, perhaps creating hubs near where people live, cutting out the unsustainable schlep to the city a day or so a week. “More choice is a better worklife after all.” Slessor is right. Now that would be much better.

Top 5 elements most wanted in the office:

1: Natural light (44%)

2: Plants (real ones) 20%

3: Quiet working space (19%)

4: View of the sea (17% – you wish!)

5: Bright colours (15%)

Source: Human Spaces Global Report survey of 7000 employees in 16 countries.

March 29, published @ Human Company

*A quick calculation based on spending about 40 hours a week, 48 weeks a year over a 53 year worklife span (you get the picture - its a lot.)