Light-bulb leadership: creating a culture where innovation is in.

ANY ORGANIZATION CAN INNOVATE ONCE, says Paul C. Light, in his book Sustaining Innovation: Creating Nonprofit and Government Organizations That Innovate Naturally (1998, Jossey-Bass). The real challenge, says Light, director of the Public Policy Program at The Pew Charitable Trusts, Philadelphia, is to innovate twice, three times, or more--to make innovation a part of daily good practice.

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Jeff De Cagna, chief strategist and founder, Principled Innovation, LLC, Arlington, Virginia, who has conducted extensive research on innovative practices, shares Light's conclusion that innovative ideas don't just appear in the proverbial light-bulb moment. Rather "they emerge from a critical and systematic process of embracing innovation." So explained De Cagna in "The Association Innovation Imperative," a presentation he made earlier this year at the Center for Association Leadership, Washington, D.C. "And the brutal facts," says De Cagna, "are that innovation is hard and it is absolutely necessary because of profound economic, social, and technological change."

Defining innovation as "a systemic discipline for consistently acting on ideas to create new value," De Cagna has identified five organizational contexts that must be present for an organization to sustain a commitment to innovation across time: strategic, technological, cultural, intellectual, and financial. (See sidebar, "Innovation: Thinking It Through for Your Association.") And while the organizations profiled in this article have established their own criteria for creating a culture that innovates, the elements of their criteria track fairly closely to the contexts De Cagna identifies as crucial.

Clarifying and revisiting strategic vision

Most leaders today would agree that the five-year strategic plan just doesn't cut it any more. While the process is likely not dead, as Tom Peters and others have claimed, frequent reassessment is part of keeping up with today's pace of business.

Reality-based strategies. For Wayne McMillan, CAE, president and CEO of the Bobby Dodd Institute, Atlanta, the organization's strategy, which is the catalyst for coming up with the ideas that will keep it strong, is based on three assumptions. Says McMillan, "We first assume that within the next three years, at least a third of the things that we are doing will go away. Second, everything has a shelf life of fewer than four years, so we need to revise and revive things regularly. And the third thing we assume is the need for organic growth." By this McMillan means establishing an emotional relationship with your customers that makes them into partners--and ultimately into consultants who join in the brainstorming of potential ideas.

Helping people with disabilities reach their potential through economic sufficiency is the institute's mission--which means getting people trained and ready for placement in jobs. "We're a bit unusual for a 501(c)(3) organization," says McMillan, "in that our strategy has resulted in our going out and getting subcontract work, putting ourselves on the receiving end of outsourced work, and even starting our own businesses."

Logical next steps. At Good Work, Durham, North Carolina, the next step in its organizational strategy resulted in the Latino Initiative, a program that was recognized by The Leader to Leader Institute, New York City, as a "Nonprofit Innovation of the Week."

"Our organization wanted to expand the entrepreneurship training and support work that we'd been doing since 1991 by tailoring it to the huge influx of Spanish-speaking immigrants from Latin America who have moved into our area," says John Parker, Good Work's executive director. The organization's goal was to make the training workshops and business support that it already provided to English-speaking constituents culturally appropriate for the area's rapidly growing Latino population. "Obviously," says Parker, "that meant making our services bicultural and bilingual to help provide entrepreneurial support for starting and expanding small businesses."

Holistic strategies. Innovative ideas for the Sacramento Convention and Visitors Bureau, California, have been cooked up in a crucible of expanding competition and a recognition that the bureau's strategy could use an overhaul. "When we began to revise our marketing plans, we realized that we needed to completely revamp our organizational goals to make them more strategic," says Leonard Hoops, vice president and chief marketing officer of the Sacramento bureau. Rather than continue to focus on separate business functions, says Hoops, "we started thinking about how we could infuse our public relations themes and language, for example, into membership, marketing, and education activities." Such thinking resulted in the formulation of five objectives critical to the Sacramento CVB's success: Generate visitor-related economic impact, satisfy the customer, position Sacramento for long-term visitor business, foster positive relationships with stakeholders, and run an effective business. "Now," he says, "everything we do must be aligned with these objectives--or we do not do it." This strengthening of strategy has helped set the stage for creative ideas such as a new branding strategy, "Discover Gold in Sacramento," and the recently launched Sacramento Gold Card, which uses smart-card technology to provide exclusive offers in dozens of local restaurants, attractions, retailers, and more. (See sidebar, "A CVB on the Cutting Edge.")

Alignment with corporate strategies.

Though corporate innovation is clearly more visible to consumers--think 3M and its Post-it Notes or Palm Computing, Inc., and its Palm Pilot--the creative processes behind the scenes can provide valuable lessons. Take, for example, the Walt Disney World Resort, Lake Buena Vista, Florida, where institutionalizing creative processes has been nothing short of a survival technique for the textile services team, which provides laundry service for the theme parks as well as the 25,000 hotel rooms on Disney's various properties. Cyndi Michalos-Baker, manager of field operations, will tell you that outsourcing of the laundry function has been considered three different times. "Particularly, since entertainment is the company's core business--and laundry is not--ours is a potentially vulnerable business," she says. "As a result, we're highly motivated to constantly look for creative and cost-saving ideas. To achieve efficiency and high quality, the staff has a systematic way of bringing innovation and excellence to the facility." More about that later.

Cultivating partnerships

Both external and internal partnerships are key to effective innovation.

Natural allies. "For the Latino Initiative," says Parker, "the local Latino Center was a natural partner, since it and Good Work had compatible goals. The center was interested in community economic development but didn't want to reinvent the wheel. [It] recognized the work that we were already doing in entrepreneurship training and ongoing support." Other obvious partners were the Self-Help Credit Union--a lender that helps with small-business loans--and the Latino Community Credit Union, which provides a lot of basic financial services for the Latino population.

New contacts. On the other hand, the Bobby Dodd Institute is constantly on the hunt for opportunities to partner with new supporters and to provide its business services to new groups. "We don't wait for the wolf to come to the door," says McMillan. "We do searches on the Internet for state and federal government contracts that may be coming up for competitive bid. Legislation allows nonprofit organizations to apply for these to be set aside for them, and that's what we do. We talk to the people in charge and can often offer a value proposition that saves them money. It's a win-win situation."

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Another priority of McMillan's is finding partners that can provide expertise that his group doesn't have. For example, when the institute got the contract for managing mailroom facilities at an Atlanta university, "we interviewed three for-profit companies that do mailroom operations, choosing the one that had the best reputation and the most experience," he says.

Partnering with internal clients. In a huge organization such as Walt Disney World Resort, building relationships with relevant departments is key to discovering creative ideas, says Michalos-Baker. "We bring wardrobe managers over to work in the laundry facility for three to six months," she explains. "Perhaps after having that experience, the wardrobe department won't design 3,000 housekeeping uniforms with pleated skirts that must be meticulously ironed." Similarly, the textile group buddies laundry personnel with housekeeping staff to see, for example, how frustrating it is to find a stain on a towel that they've opened up to hang in a hotel guest's bathroom. "By building these kinds of relationships, we find the many small things that can contribute to creative solutions to problems," she says.

Nurturing a creative culture

If you are finding it difficult to motivate employees--or your board or constituents for that matter--to pony up the Aha ideas, take some advice from the American Productivity and Quality Center, Houston. In working with its member companies to maximize productivity and improve quality, the center has found (and reported in its white paper "Rewarding Innovation," by Paige Leavitt) that environments encouraging bright ideas

* create a design team;

* consistently acknowledge those who contribute ideas, knowledge, and time;

* provide special recognition to volunteers, change agents, and model innovators;

* disseminate success stories concerning the development of a successful new product or approach; and

* link innovation to the core cultural values of the organization.

Similar approaches are working well for McMillan, Michalos-Baker, and Parker.

Respect and recognition. "We try to foster an atmosphere that has a lot of respect for people who make a contribution," says McMillan. "And we don't get hung up on expecting success every time a person suggests or tries something--otherwise they won't want to try things." As for recognition, he truly finds that it's the private tributes that really mean the most to staff. "If you've come up with a good idea and your supervisor sends you a thank-you note or gives you a pat on the back--that does more than anything that we can do in an employee newsletter or a public venue."

In polling the 600 cast members (Disney's name for its staff) in the textile services group about their preferred forms of recognition and reward, Michalos-Baker says the number one answer is "thank me personally," followed by "feed me," and "give me movie tickets."

Ideas from all around. "Lots of our new ideas and explorations surface because constituents who have gone through our entrepreneurial training programs come back to us to talk about things they'd like to see," says Parker at Good Work. With a staff of only three, it's critical that such bonds are forged. "Recently," says Parker, "some former program participants came to us and said, 'What you are doing for us is great, but can you teach economic literacy to our kids?" It's a germ of an idea that Parker and his group will consider.

Good Work's program manager Murtado Bustillo agrees that the effective communication that the organization has with its constituents comes in large part from the follow-up service the staff does with those who become entrepreneurs in the community as a result of its training and support programs. "The fact that we are able to continually connect with our constituency allows us to update workshops based on new trends and ideas--or to provide information on new laws affecting the business community," he says. Another tactic that Bustillo firmly believes keeps the organization vibrant and fluid is to keep an open mind. "The main thing for us is to adjust our training and our materials to the needs of the community rather than force the community to adjust to us. So for the Latino Initiative it's much more than simply translating our materials from English to Spanish--[it's] understanding the cultural differences and the specific needs of those we are serving."

Figuring out funding

New initiatives rarely come at no charge. So where do organizations come up with the necessary scratch? While the Bobby Dodd Institute is a 501(c)(3) charitable organization, the institute only receives 7 percent of its budget from contributions; the rest comes from its eight businesses that produce revenue in support of the organization's tax-exempt purpose. But McMillan is not one to rest on the organization's laurels. "We are doing a feasibility study right now for a capital campaign," he says. "And, of course, we continue to look to the funding community; they have really liked our placement services and training programs for people with disabilities."

At Good Work, Parker has turned the Latino Initiative, originally funded by a foundation, into an ongoing program by laying the responsibility for its future at the city of Durham's door. "It was important to me that the city recognize that the Latino population needed this kind of support as much as the English-speaking population, our program for which the city was already providing funding." Now, community development block grants fund both ongoing programs.

In the corporate setting, departments and divisions must compete for limited budgets. At Disney, says Michalos-Baker, "the company is so big that you might think we have unlimited funds. But that's not true. We compete with a multitude of other projects and financial priorities. So we are constantly on the lookout for cost-saving measures--particularly because we continue to live with the real possibility of outsourcing."

Pulling it together in a process

While Good Work and the Sacramento Convention and Visitors Bureau have less formal plans for the innovation process, the Bobby Dodd Institute and the Walt Disney World Resort have implemented specific processes that help them identify and evaluate proposed ideas.

Mission, operations, success, and target.

In a homegrown process model referred to as MOST, McMillan and his team put innovative ideas through their paces before taking any action. The idea has to pass muster at each step or it doesn't move forward at all. Here's what the team looks at.

* Mission. "We consider our mission and see if the proposed idea is one that extends support to people who aren't being served, addresses an unmet need in society, or for which stakeholders are expressing a need. If it doesn't do that, we don't go any further," says McMillan.

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* Operations. For each proposed project, the staff calculates the capitalization that is required, where funding might be found, and whether the initiative will break even within 12-24 months, which is generally a requirement to move forward.

* Success. Factors predictive of an effective outcome include required expertise in the work dictated by the particular program, availability of a partner that could provide that expertise, and the overall management capacity to include the new program in the scope of the institute's work.

* Target. In the end, says McMillan, "we want to make sure that with a new idea we are targeting the populations we intend to serve. Is the initiative going to lead to training that leads to employment and competitive wages--and does it have a diversity aspect that is inclusive of ethnicity, geography, and people with disabilities?"

McMillan admits that a lot of ideas don't make it through the process. A proposed ice cream shop, for example, was a nonstarter because capitalization was too high, the break-even point was too far out, and the number of jobs created was too small. Picking the right programs to go after, he says, "is about being focused, doing something for the right reason, and having a strong business plan."

Organizational creativity model. Central to Disney's ability to keep delivering creative ideas--in its entertainment offerings as well as behind the scenes--is a formalized process that infuses creativity throughout its multiple and complex operations. It's referred to as "the business behind the magic." The model's three legs are organizational identity, structural systems, and a collaborative culture.

* Organizational identity. "Everyone here knows that our mission is to provide the best possible experience to our guests and that our backstage areas have a big impact on making that a reality," says Michalos-Baker. "If a character is walking through Epcot wearing a dirty costume, the guests that interact with that character will not have the high-quality experience that they expect."

* Structural systems. Predictable processes ensure that ideas are analyzed for their ability to contribute to goals of quality and efficiency, that they are developed properly, and that they are implemented successfully and ultimately get results. In the distribution services area, which houses and distributes products and inventory to 300 retail outlets, 17 hours per day, 365 days a year, that translates into a constant focus on finding ideas to keep costs down and develop time-management savings. Bruce Terry, manager of merchandise distribution, recalls one of his area's first light-bulb moments. It came when several cast members in distribution services realized that they could achieve efficiencies in distributing one of the company's top-selling items--the Mickey Mouse autograph book--to the retail stores on the property. "We were stocking this item, which we needed to retrieve 20 or 30 times per day, at the far end of the building, so it took a lot of travel time each time we picked an order. We moved the inventory right near the front--and also recommended that it be picked from the shelves only in standard packs, nothing less." These simple fixes made for half as many trips per day.

* Collaborative culture. Building genuine relationships between people is key to ideas being expressed openly and without fear or embarrassment. It's why, for example, the distributive services cast members adopt partners within the retail shops to help with creative solutions. One such relationship resulted in what has become an organized "call for umbrellas," which prompts the distribution center to start delivering rain gear to the shops within minutes of a raindrop hitting the sidewalk.

Back in textile services, Michalos-Baker talks about how creative solutions often come most quickly from those who share a common problem: "We developed a hook to help pull the laundry off of the carts that move quickly through our facility, but the sharp ends of the hooks sometimes ripped the sheets. Together our team came up with the idea to bend the sharp end of the hook back, and that simple idea saved us $100,000 per year in damaged linens."

No rest for the innovative

Good Work's Bustillo concludes that creativity comes from a process of continuous learning. "We need to realize that we don't have all the answers; we must continue to grow and partner with other organizations and attend the kind of training that refreshes us and allows us to bring new things back to the community. The biggest failure is when you feel that you've already learned everything."

Sharing Bustillo's opinion, Parker has recently returned from the annual conference of the Association for Enterprise Opportunity, Alexandria, Virginia. "Meetings like this give you a national perspective and help you to [remember] that you are not working in a vacuum," he says. Parker also networks with people in organizations within North Carolina, taking advantage of the informal learning community. "We have deep discussions that are both strategic and visionary," he says, "and try to dream up new ways of working with folks in our constituencies."

When you assess how things have progressed in your organization, reminds McMillan, "creativity and running a business are not linear." That is one reason why he and his staff conduct a postmortem on every initiative--whether it's a success or not. "We look at what went exceptionally well, what we would change, and what lessons we learned. Even if something hasn't gone well, we can dig into why it didn't turn out as intended--and that can sometimes be the key to success the next time around."

Want more information on this topic? Check out the "Outtakes and Exclusives" and "Link to Learn" areas at www.amonline.org.

RELATED ARTICLE: A CVB on the Cutting Edge

When Leonard Hoops, vice president and chief marketing officer of the Sacramento Convention and Visitors Bureau, California, and his colleague Doug Scholz, director of partner marketing, completed a presentation to the board of directors on the idea of a Sacramento Gold Card program that would use smart-card technology to provide exclusive offers at local restaurants and attractions, "we got spontaneous applause," says Hoops--still rather surprised months later by the reaction.

Hoops gives credit to the entrepreneurial spirit of the board and staff--as well as to the additional perspective brought to the board by members outside of the industry--for the bureau's inclination to shake things up and take some risks.

The springboard for a more innovative mind-set, says Hoops, was the doubling of the bureau's budget from $3 million to $6 million as a result of Sacramento's being voted a business improvement district, a move that provided an assessment in addition to the customary hotel room tax. Additional resources meant that the Sacramento CVB's leadership could begin to come up with ways to solve some of its most pressing problems. One of those, says Hoops, was the fact that consumer travel programs could not be tracked for economic impact, and, consequently, it was difficult to evaluate marketing programs--and to accurately calculate the full impact of the bureau's efforts on Sacramento's tourism business.

"The traditional way we measure success," explains Hoops, "is through our bureau booking channels--our toll-free number and our Web site, specifically. However, if customers decide to reserve their hotel rooms directly--perhaps because they get a better discount from AAA or an online broker--we lose the ability to track any of the local business that results."

FINDING A CREATIVE SOLUTION

The process that Hoops and his team used to ultimately solve this problem reveals some points on the creativity curve.

* Search for something that already exists. Hoops tinkered with the idea that a technology might already exist that could be applied to the bureau's particular challenge of tracking clients and their business. In conducting a search on Google, he found the seed of an idea: A few companies in Europe and Canada were using a smart-card technology to market gift cards that could be preloaded with monetary value that would then be deducted as the user made purchases--not unlike gift cards for Starbucks or Borders, but with more specialized information retained by a chip in the card.

* Tailor technology to your specific purpose. In quizzing people from the company that provides the prepaid merchant cards, Hoops found out about a partner company, a credit card processing company, that held some promise. Soon Hoops and Scholz were querying the company, along with several others, about the ability to modify the smart-card technology in such a way that Sacramento hotels could provide the card to guests at check-in, and the cards could be used in various card-reader terminals placed with entertainment, restaurant, and shopping partners throughout the city that would print out discount coupons for their particular venues. Because the cards could be programmed with basic information related to the hotel guests (home ZIP code, number of people in the party, number of hotel nights reserved, and whether the trip was for a convention, business, or leisure), expenditures could finally be calculated to quantify the economic impact of a particular group or of a regionally targeted marketing campaign.

* Conduct due diligence. Scholz was tasked with taking care of the due diligence on the project, further researching various smart-card providers, making sure that the bureau could have confidence in the ultimate product, testing the waters with the businesses that could ultimately benefit from the use of the Gold Card, and considering the kind of investment and training that would be involved in rolling out the program.

* Reduce risk as much as possible. Because it appeared that no other convention bureau had set up a similar program, Hoops and Scholz felt that they were in a good negotiating position. They mitigated much of the bureau's financial risk by getting the supplier to provide the terminals and smart cards at little or no cost and agreeing to a six-month embargo on offering the technology to any other organizations. In return, the Sacramento CVB will test, endorse, and promote the product, which Hoops anticipates "will be attractive to every CVB in the country."

Before launching the program, the bureau was able to attract approximately 50 local companies to develop attractive discount offers and install the card-reader terminals, with the local hotels being the point of distribution for the Gold Card program.

* Garner necessary support. Hoops notes that he and Scholz did their homework before presenting the idea to Sacramento CVB President and CEO Steve Hammond. "We reviewed the specific problems we were trying to solve and the technology solution that we had identified," says Hoops. "Steve really liked the idea, and when we told him that we had not seen any other bureau in the country doing this, he got even more excited." With Hammond's backing, the two took the presentation to the board of directors--and, as Hoops said, they applauded the idea and gave it their blessing.

REPORTING PRELIMINARY RESULTS

The Sacramento Gold Card launched in mid-June, and in the first two weeks, 215 cards were activated, representing approximately 400 hotel room nights. As this article goes to press, Hoops is enthusiastic because not only have some of the early bugs in the system been worked out, but also secret shopping of the card-dispensing hotels shows that the front-desk staff understands how the cards work and are distributing them to guests who request the card. During the soft launch of the program in early June, says Hoops, the card terminals were not automatically uploading the data indicating that the cards were in use. "Believe me, we went from geniuses to thinking we'd have to look for new jobs," he recalls. "But that's part of embracing innovation; you have to be willing to take some risk."

RELATED ARTICLE: Catalysts for Creative Thinking

Kick-start the development of some smart ideas in your organization by studying the sources that follow.

SAVVY SITES

* Go to www.thinksmart.com, the Web site of the Innovation Network, to learn about everything from Innovation DNA to conducting an innovation audit of your organization.

* Visit www.winstonbrill.com where you'll find current articles and archives of the Innovative Leader, an online newsletter that helps managers stimulate creativity and productivity. Authors include top consultants, industry and academic leaders--even Nobel Prize winners.

* At www.innovationtools.com, you'll find a growing collection of resources on innovation, creativity, and brainstorming that can help you be more creative in your organization.

PERCEPTIVE PAGES

* In Business Think: Rules for Getting It Right--Now and No Matter What! (2002, John Wiley & Sons), authors Steve Smith and Dave Marcum explain how individuals and organizations "can cut through the fog of egomania and politicking to bring forth the best ideas people have to offer and make good decisions."

* "Successful Innovation Through Artful Processes," by Rob Austin (a professor of business administration at Harvard Business School) and Lee Devin (professor emeritus of theater at Swarthmore College), describes what the authors learned during a four-year collaboration in which they observed artists and business innovators. They identify an "artful process" that reflects the new reflexes and skills necessary for managers of the future. Reprints of the article, published in the Spring 2004 issue of Leader to Leader, are available at www.pfdf.org/leaderbooks/121/subscriptions.html.

* Paul C. Light, in his book Sustaining Innovation: Creating Nonprofit and Government Organizations That Innovate Naturally (1998, Jossey-Bass), offers success stories and practical lessons in how organizations can take the first steps toward innovation, survive the inevitable mistakes along the way, and develop the tools that can keep the process going.

* In "From Bright Ideas to Right Ideas," Michael Michalko provides insights into creative thinking and a number of sources for further information. To purchase the article, published in the September/October 2003 issue of The Futurist, go to www.wfs.org/backiss.htm.

RELATED ARTICLE: Innovation: Thinking It Through for Your Association

Many association leaders espouse a belief in the importance of innovation, although only a precious few have taken any concrete steps to make it happen in their organizations. But it isn't necessarily a lack of desire that makes CEOs and senior executives less than fully committed to innovation, even when the organization is failing to create new value in other ways. Innovation, which I define as a systemic discipline for consistently acting on ideas to create new value, is so challenging for organizations to implement because it is about building deep organizational capacity rather than merely collecting, aggregating, and executing so-called best practices. Given the challenge of making innovation work, it cannot be treated as a crash program or, worse still, the province of one or more creative individuals who "go off and develop new things." Association leaders need a clear lens through which they can look at the question of innovation in a constructive fashion.

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Based on my research on innovation during the past few years, I have reached the conclusion that association leaders must actively orchestrate five different, yet related, organizational contexts to create an organization that is able to sustain a commitment to innovation across time. Let's look at each of these five contexts.

STRATEGIC CONTEXT

The entirety of any organization's innovation work is situated in its broadly construed strategic context. It is the clarity and robustness of this context that establishes the organization's direction and allows innovation to take root as a genuine priority. But the strategic context is not merely about the association's actual strategy or the specific innovation opportunities that emerge from it. It is also about building a shared commitment among key stakeholders to the organization's vision and mission, continually assessing the broader operating environment, evaluating and streamlining governance, carefully reflecting on how the organization's leaders think about and make strategy, and developing an authentic mindfulness about the strategic importance of innovation that contributes to success in other areas.

TECHNOLOGICAL CONTEXT

The technological context of an association's innovation work goes far beyond which association management system it chooses, how it designs its Web site, or whether it uses listservers. These routine applications of information technology are necessary for managing day-to-day operations and help to free up critical financial and staff resources. In this context, however, leaders also must consider how current and future technologies might be leveraged to help the association establish a sustainable pace for innovation and extend its innovation reach to include members, customers, and other stakeholders. Yet another consideration in identifying opportunities for innovation is the need to fully explore the impact of emerging technologies on the strategic and intellectual directions of the professional or industry ecosystem that the association serves.

CULTURAL CONTEXT

To help innovation flourish, association leaders must nurture a headquarters culture that is deeply connected to the best of the organization's history and traditions, while not being limited by it. It also must be a culture that is authentically entrepreneurial in both spirit and in action. A genuine culture of innovation is open to ideas from a variety of sources, embraces and effectively manages risk, accepts failure, and respects and listens to many voices. The culture of innovation embraces experimentation within the framework of the organization's strategic direction and financial goals.

Still another key issue in cultural context is the interaction between the prevailing member culture--the culture of the industry or profession the association serves--and the staff culture. Leaders must act with great care to create strong working relationships between members and staff so that any tensions arising between the two cultures in relation to innovation's risks and rewards are leveraged positively and creatively.

INTELLECTUAL CONTEXT

Innovation is about more than ideas. Indeed, the entire intellectual environment of an organization must be attuned to innovation. Associations must have a constant, yet manageable flow of new knowledge to facilitate innovation. Organizations that permit the not-invented-here mentality to take hold in their thinking will find it difficult to make innovation a true priority, since most of the knowledge needed to pursue innovation lives beyond the established boundaries of a single organization. In addition, innovation-oriented organizations are fundamentally curious about ideas and encourage their people to be curious as well. Innovation isn't only about knowing what you know. It's also about recognizing that you don't know what you don't know and remaining open to discovering it. Ensuring the openness and transparency of the innovation process is an intellectual (as well as cultural) consideration that leaders cannot ignore.

FINANCIAL CONTEXT

One of the most significant myths of innovation is the misguided belief that it is too expensive for a nonprofit organization to pursue. The real issue, however, is that innovation hasn't been a widespread priority in this community, and as a result, no clear-cut financial investment models exist. So as you innovate and pave the way for the rest of the association community, keep in mind that your financial investment model for innovation should fit within your organization's strategic context.

For instance, the financial model must define the sources of and limits on available funding, the real costs of innovation, and the process and criteria to be used in making funding decisions. Moreover, the financial model must discuss the process by which decisions and investments will be made, the elimination of nonstrategic spending, and the need to make related investments in innovation-support technologies.

ORCHESTRATION, NOT ALIGNMENT

The successful innovation leader in today's association will not seek to align these five contexts, a terribly challenging effort in today's turbulent operating environment. Rather, leaders must seek to orchestrate and coordinate the relationships between and among these five contexts. This effort demands a different kind of leadership, one that understands that the future of our associations will never be discovered by longing for a world that is forever gone but in embracing the possibilities of what comes next. Innovation is the surest way to strengthen our organizations for the future. It is difficult to implement, to be sure, but it is also necessary and, in my estimation, quite possible if we're willing to try.

BY JEFF DE CAGNA

Jeff De Cagna is chief strategist and founder, Principled Innovation, LLC, Arlington, Virginia. E-mail: jeff @principledinnovation.com.

PHOTOGRAPH BY GARTH VAUGHAN

Carole Schweitzer is executive editor of ASSOCIATION MANAGEMENT. E-mail: [e-mail].