Innovative management ideas that bubble up in other companies pose a
perennial quandary for leaders: Should you attempt to borrow new ideas,
and if so, which ones and how? Even the most promising practices can be
disastrous if they're transplanted into the wrong company, writes Julian
Birkinshaw of London Business School. Broadly speaking, there are two
ways to borrow from innovative companies, he argues. The first, observe
and apply, is the most commonly used approach for adopting new
management ideas. It can and does work well, but only under limited sets
of circumstances: when the observed practice easily stands alone or
involves just a small constellation of supporting behaviors (think of
GE's well-regarded succession-planning process) and when a company's
management model or way of thinking is very similar to the originator's
(think of two software firms that both use the Agile development
approach). The second method is to extract a management practice's
essential principle--its underlying logic--and ask a series of questions
to determine if it is right for your firm, including: How is your
company different from the originating firm? Are the goals of the
practice important to your organization? Many management innovations are
launched with great fanfare, only to fade in popularity. With careful
analysis, you can avoid falling prey to this hype cycle. And even if it
turns out that a borrowed idea isn't right for you, the analysis will
help you better understand your own management models and sharpen your
practices.