Microsoft created a biome or an environment where innovation happens throughout the company
Historically companies have innovated by creating small teams to develop or refine an idea. Sometimes these teams are successful, and more often, they aren’t. New value creation in corporations has rarely meant bringing an entire corporation along on its innovation journey. However, every company will have to do just that if they want to thrive in a world where the bar to creating offerings that customers embrace keeps getting higher.
Microsoft was an early company to understand that the old top-down approach to innovation needed modernization. The company wanted to move away from the belief that only leaders or innovation departments are the ones who come up with great ideas and push them down into the organization.
The company knew good ideas exist in employee minds in every department and at every level. The collective innovation potential that resides in the organization is almost limitless, but the question the company faced is how do you harness that potential? How do you create an environment where innovation thrives, everywhere?
Democratizing Innovation
The company created the Microsoft Garage, a hub designed to catalyze grassroots innovation. The concept was that if you give employees spaces, support, assistance, and some guided programs, then anybody who has an idea could do something with it. And when everyone can contribute to innovation, the company creates a different kind of dynamic where innovation is democratized, and the best ideas are the ones that prosper.
The goal of The Garage was to bring the entire organization on the innovation journey. If employees saw something broken or something that could be better, they wouldn’t have to wait for someone else to build it. They could go to The Garage to develop their ideas. The Garage encouraged the “tinker” culture that Microsoft wanted from its employees.
Microsoft CEO Satya Nadella was a believer in the Garage’s potential to help him define the growth mindset he articulated in his book Hit Refresh. He challenged the Garage team to put together a program to promote company-wide innovation and encourage everyone who has an idea to create a proof of concept and share it broadly.
The Garage responded by working across the company to create The Global Hackathon, a week-long event where employees came up with ideas, recruited other employees to collaborate, gathered together, and “hacked” away, refining their concepts and creating new proofs of concepts. At the end of the week, these teams excitedly shared what they built with company leaders and fellow hackers. Some of these ideas would get incorporated into Microsoft’s products and used by millions of customers.
The first Hackathon saw 11,000 employees participate, many of them working in large tents set up at Microsoft campuses worldwide. The company quickly realized that they were on to something special. There was a massive amount of pent-up energy and creativity, and the Hackathon served as an outlet for people who were passionate about things they wanted to build.
But the company also learned that people didn’t just want to pursue their ideas. They wanted to build things that mattered. They wanted to help solve big problems the company faced. They wanted some parameters and guardrails on where they could add fresh thinking.
As a result, the next year, the Hackathon introduced “challenges” developed by the company’s leadership teams, and employees began working on challenging problems the company faced. The Hackathon kept growing, and each year the company kept adding new ways to spur innovation. One year they introduced hacking with customers, so employees could first-hand experience customer obsession and understand how customers interacted with their products.
Initially, however, mostly engineers embraced the Hackathon, who latched on to the concept as it spoke to them. Hacking traditionally meant writing code, something Microsoft engineers were good at doing. But the company did not just want to bring engineers on the innovation journey; it wanted to involve employees from all disciplines. As a result, the company made a concerted effort to encouraging participation from all roles and organizations within the company.
And it worked. For example, one group of employees created a new process for managing inter-company transfers or moving to different jobs within Microsoft. The HR group saw this “hack” and implemented it as a policy across the company. And hacking was not limited to creating or improving company products; employees could “Hack for Good” and develop solutions for non-profits they supported.
How Covid-19 Created the Future of Innovation
In early 2020 the coronavirus pandemic hit the world, and Microsoft employees began working from home. Holding an event where people gathered in large tents was not possible. The magic, excitement, and energy that spawned innovation could have been lost. But creativity always finds a way to shine, and incredible inventions, including the creation of the Internet, were pioneered by individuals scattered across the world, something I have discussed here.
Microsoft needed to recreate the energy, passion, and cohesiveness of the Hackathon while the entire company was working from home. Innovation still required people to collaborate, ideas to clash, and creativity to flow. While virtual collaboration had always been a component of Hackathon’s worldwide event, in 2020, it became the only way to take part. So, the company pivoted to more effectively enable participation from anywhere, anytime. The lessons they learned will have a lasting impact on how corporations will think about innovation in the future.
As Susie Kandzor, Microsoft’s Director of Hacking, explains, the company began by giving employees multiple avenues for contribution. If someone did not want to write code, they could participate as advisors and provide their unique expertise to projects. People who had good ideas but could not pursue them became ideators and shared their vision to project teams looking for something “cool” to build. Many employees just visited the project pages of others, encouraging them and providing assistance and suggestions.
The results were staggering. Over 70,000 employees from 97 countries and just about every department participated in the 2020 Hackathon, making it the world’s largest private innovation event. Despite the pandemic’s challenges, Microsoft created a biome or an environment that unleashed innovation throughout the company. Employees who had been with the company for less than a year participated with the same enthusiasm as thirty-year company veterans.
Employees who had never met worked together because they wanted to solve a common problem. Since everyone was virtual, people were far more open to working with others across geographies, time-zones, functions, and skills. Like-minded people who would never have connected at an in-person event came together. Employees from different corners of the world collaborated, engaged, became friends, and created prototypes of many kinds, leading to a high quality of projects and an unmatched diversity of ideas.
The company realized that the pandemic did not diminish the spirit of innovation. Even though employees were isolated, they still needed time to work on their pet projects. They still needed an outlet for their innovative ideas to come to life and were unanimously grateful that the company provided it even during a challenging time.
Microsoft did need to put some new thinking into making the virtual Hackathon a success. For example, from months of previous remote work, the company knew that communication is challenging when everybody is virtual. They realized that they needed to communicate the same message multiple times and across different channels because people consume information differently while they collaborate from home.
The company also recognized the need to create a sense of community and camaraderie among participants working from home. As a result, they introduced “Spirit Week,” before the Hackathon, where employees got to know their teammates and bonded by creating and sharing Spotify playlists with fellow employees or speaking with their kids about the Hackathon, which invariably led to a discussion of creativity and innovation.
Innovation is an always-learning process.
Microsoft plans to make many of the virtual elements of the Hackathon permanent. As a continually learning organization, Microsoft is committed to improving the Hackathon. For example, one thing that did not go quite well in the virtual event was teams’ ability to share their work broadly. People were proud of what they built and wanted to show their project to company executives and one another. In previous years, while they hacked in tents, they could showcase their work and talk about their project. But in a virtual world, displaying four thousand projects was a challenge.
However, there are things that every company should learn from the Microsoft example. While such an event may or may not be the right thing for you, your company needs to create the Hackathon spirit that fits your unique circumstances and culture.
Every company needs a systematic program that spreads innovation throughout the organization, primarily because their employees have great ideas and want to contribute. You need to provide them with an outlet. The most outstanding companies have done just that and have created an environment where innovation thrives. You can do it too.
