10 Lessons Learned on Innovation in Government from My Conversation with City West Water’s Sean Hanrahan

City West Water is a wholly Government owned retail water business operating throughout inner and western Melbourne.

Having worked with City West Water as the business got its innovation program off the ground, I’ve had the opportunity to build relationships with key people from across the organisation and learn more about innovation in water.

As I like to do with clients, I decided to celebrate some of the early successes that City West Water has had with its innovation program by asking the head of its innovation fund, Sean Hanrahan, also its Senior Environmental Strategist, to appear on my podcast to share key insights and lessons learned.

I’ve captured the key lessons learned from my conversation with Sean below.

1 To Get and Keep Buy-In, Include Innovation in the Business Strategy

Three things corporate innovators the world over struggle with is getting buy in from senior stakeholders for innovation, maintaining that buy-in and keeping the momentum going in the face of changes at the top and restructures. Sean maintained that by capturing innovation as a key priority in City West Water’s business strategy, it was much easier to get and keep buy in, particularly as the organisation navigated a restructure smack, bang in the middle of its innovation program.

2 Engage Key Stakeholders in the Process

In addition to business strategy, by engaging key stakeholders from across the business and consulting with them on what the innovation program would look like — rather than just showing them the finished product — and by engaging them in the subsequent delivery, you’re far more likely to get ongoing ownership and commitment from the people that can be the lifeblood or ring the death knell of innovation programs.

3 Define and Communicate Logical and Clear Objectives

Given where City West Water is in its innovation journey, it didn’t make sense for the organisation to be targeting ‘disruptive ideas that will transform the way we manage water’ overnight. But it did make sense for the organisation to target greater awareness of the need to innovate and engagement amongst its workforce.

It achieved this by creating an innovation blog and an innovation community on its Yammer network, hosting a keynote on innovation, running an initial ideation and pitch campaign, providing mentoring to keen employees and facilitated subsequent hack days to turn ideas into prototypes. Such initiatives all move the needle on awareness and engagement.

4 Get People Building Cross-Functional Teams

As part of its push to get people collaborating from across the business, the business’ innovation challenge required people to get names from across the business onto their application form which meant you’d at least have to have socialised your idea and sold it to people from across the business, rather than operating in isolation.

5 Set up Different Streams for Different Types of Ideas

City West Water set up two streams as part of its innovation challenge. Incremental business improvement ideas would go into the business as usual stream and require a standard business case to explore, whereas more disruptive or “innovative” ideas would be evaluated using a different criteria and would be funneled into a hack day if successful for rapid prototyping and experimentation.

For more on setting up alternative product development funnels, check out The Business Case Alternative.

6 Assemble a Cross-Functional Judging Panel

Where innovation challenges often come unstuck is you have purely senior executives, often with a narrow world view and with a track record of working only on business improvements, evaluating ideas that fall into the realm of disruptive ideas, which they are usually ill equipped to do.

In the case of CIty West Water, they assembled a judging panel that consisted of GMs from across the business but also brought in outsiders who deal with disruptive and early stage innovation every day to bring fresh perspectives and challenge the GMs thinking.

The result was more meaningful conversations during evaluation of ideas and decisions made based on a wider view of the world — one that combined domain expertise in water with startup and early stage innovation expertise.

7 Selection Criteria

Aside from having a good mix of people evaluating ideas, having a tool in place to guide this evaluation supports the robustness of the process. Factors such as business strategy alignment, customer experience and size and relevance of the problem were put forward as key considerations in the selection criteria.

8 Customer Experience

In today’s age, whether you’re a publicly listed company, a private company or a Government owned business, “if you stand still, you’re dead” and as people’s expectations insofar as customer experience is concerned continue to heighten, people will feel it and make their voices heard if they feel they are being underserved. City West Water has its local community at the centre of everything that it does and as such tracks factors like Net Promoter Score and had customer experience as one of its key selection criteria for ideas.

9 Empower Others to Innovate

What City West Water learned during a hack day we hosted at Collective Campus, was that while they have some great ideas, they aren’t necessarily built to deliver them, nor should they. But given the organisation’s size and influence, they could empower other organisations and work with them to deliver innovations to market, particularly if they can position themselves as a paying customer for innovations that will align with its business strategy and delivery value back to the community.

(Similarly, if you’re an entrepreneur, focus on where you deliver the most value and outsource everything else!)

While it can be difficult for such bodies to engage say, startups, because of procurement policy requirements such as insurance and respective certifications, that doesn’t mean that they shouldn’t. Anything worth doing is usually not easy.

10 Partner with External Parties for Validation

While Sean and City West Water took a proactive step internally to design what the first year of their innovation program might look like, they engaged external parties such as Collective Campus to provide a level of feedback and validation for their program. Having the confidence to know you’re on the right track can often be the difference between application of effort and giving up.

Click here to listen to the entire conversation in episode #196 of the Future Squared podcast.