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The Performance-Innovation Dilemma

Part II
3 Errors to Avoid About Performance vs. Innovation

Leading for performance is very different from leading for innovation. And leaders must often manage both simultaneously.

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Leadership is meaningless if it doesn’t add value to the ability of people to advance the goals of an endeavor. Effective leaders craft their actions accordingly. The creative tension between performance and innovation creates a leadership challenge - actions that advance performance can inhibit innovation, and vice-versa.

There are three ways I’ve seen leaders mis-step navigating this performance-innovation dilemma:

  • Leaders who over-value performance may resist change outright, giving lip service to innovation while they focus strictly on performance execution. High success through excellent performance is particularly seductive - why change a successful formula? The trouble is, it’s easy to stick with a working formula long past it’s peak usefulness, and miss opportunities that will have a greater payoff in the future - not to mention risking competitors gaining an advantage from disruptive innovation.
  • Leaders who over-value innovation may fail to institute performance structures that capture value and achieve goals. Referring back to Drucker’s definition of innovation, “a new dimension of performance” - the value of an innovation can easily be lost if it’s never institutionalized.
  • Leaders who don’t pay attention to the difference can easily give mixed messages and create disincentives for either performance or innovation. “It’s ok to make mistakes,” is exactly the thing for a leader to emphasize for innovation, and patently the wrong message for critical core operations that distinguish an organization. Leaders who aren’t strategic in distinguishing performance from innovation may fail to do either well, keeping their organization stuck in mediocrity.

What leaders need to do is explicitly differentiate what they do to promote performance and what they do to foster innovation. Whether by structure, process, assignment, or timing, leaders who are intentional about when, where, and how they are seeking innovation vs. performance are more likely to create exceptional outcomes.


The Performance-Innovation Dilemma
Part I: What Leaders Must Know About Performance vs. Innovation
Part II: 3 Leadership Errors to Avoid
Part III: 5 Ways to Navigate the Performance-Innovation Dilemma

by Tom Stevens (c)2013
Tom Stevens helps leaders create and sustain exceptional organizations. To contact him, visit or call 919-245-1026

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