A culture of experimentation drives innovation and growth in mid-size organizations.
As a mid-market CEO, one of your primary concerns is retaining and developing top talent. But with increased competition for the best workers, keeping them engaged and motivated can be challenging. By creating a culture of experimentation where risk-taking and creative problem-solving are supported, you can foster an environment that encourages and rewards innovation. Doing so will help you retain top performers and provide valuable insights for improved decision-making companywide.
If experimental testing is so valuable, why are more companies not using it? It comes down to culture. Using resources to run experiments creates waste when the experiments fail. And companies, above all else, value efficiency. This is in contrast to other industries, like sports and music, where learning is valued and evidenced through practice, experimentation and feedback. In the workplace, there is no time to practice. Every day is game day. However, when it comes to innovation, there is no reliable, proven path.
Benefits of Running Experiments
Experimentation allows companies to gain valuable insights into customer behavior and preferences. Companies can test marketing and pricing model strategies on a smaller scale to determine what works by experimenting. Amazon is known for testing different versions of its user interface on its website to see which designs and features are most effective at increasing sales. Many companies discover new opportunities for growth and expansion by testing their products and services in smaller markets or with smaller sample sizes.
In a recent HBR article, Building A Culture of Experimentation, the author uses Booking.com as an example of a company that has benefited from experimentation. The article mentions that Booking.com runs over 1,000 experiments simultaneously, testing millions of landing-page permutations available at any time. In under two decades, all of these experiments have helped Bookis.com grow from a tiny Dutch start-up to the largest online housing platform in the world.
Creating an Experimentation Culture
Essentially, a culture of experimentation embraces experimentation throughout the company, not just in select divisions. The entire company must be committed, especially managers and executives, who must adopt an attitude that values hearing others out. Other suggestions from Stefan Thomke, author of Experimentation Works: The Surprise Power of Business Experiments, in creating a culture of experimentation include:
- Cultivate a mindset of curiosity where failures are viewed as learning opportunities.
- Experimental results are always valued over opinions.
- Democratize experimentation where everyone is embracing and using experiments as a means to test their hypotheses.
Companies can create a culture of innovation and growth by allowing workers to experiment and take risks. In such an environment, employees feel more empowered, and their loyalty increases since they are a part of the decision-making process. This in turn allows businesses to stay agile in today’s market and compete against other organizations that don’t embrace an experimentation culture.. Companies have the potential to create great results when granting employees opportunities for experimentation, leading to happier employees that aid in strengthening corporate goals — overall creating an atmosphere of collaboration, support, and progress towards success.
“All life is an experiment. The more experiments you make, the better.” Ralph Waldo Emerson