John Hancock's Innovation Council was organized to foster innovation and creativity within its mutual fund business, now known as John Hancock Investments.
When the council met for the first time in March 2012, we knew we had a great opportunity before us.
A cross-functional team of volunteers within the business had been gathered. A motivated group of individuals who were setting out to collaborate and create value for our operations and for our shareholders, while creating an experience all would remember and reflect on as their careers progressed.
The first meeting was kicked off with a presentation on Walmart. I had studied the company during a Leadership and Integrated Management course at MIT Sloan School of Management.
As the slides were passed out I could sense that the team was a bit puzzled, wondering- at first- what a retail powerhouse like Walmart had to do with our growing mutual fund business. But it didn't take long for the discussion to catch fire. After all, ideas can come from anywhere, requiring only open-mindedness to be able to identify potential opportunities and apply them within one's own business context.
Sam Walton's strategy of "saving people money so they can live better" has applicability to the mutual fund industry where lower costs and investment performance are important elements to fund shareholders saving for retirement so they too can live better.
Some of the examples of the Walmart Effect discussed at the first meeting are summarized below and started the transformation of thinking like an "owner" of the business, which plays an important role in our future success and market competitiveness.
* Discipline and focus on cost efficiencies and competitiveness
* Vendor collaboration and development of fully transparent relationships
* Use of data to manage operations and analyze business performance
* Sustainability as a business strategy.
* Oversight of suppliers and factories for adherence with Walmart compliance and ethical standards
The Council's Charge
Following is an excerpt from the Innovation Council's debut meeting.
"Welcome to the inaugural formation of the Innovation Council. Your involvement as a committee member reflects our beliefs that your direct contributions will be supportive in making meaningful changes to our business.
"We are looking for your creativity and ingenuity to eliminate waste, improve workflow and strengthen vendor performance. All of which will create value for the shareholders of John Hancock Funds, as well as, for our business.
"Your teamwork and inter-department coordination will be important to identify our focus areas. John Hancock's mutual fund business is known for its innovative solutions and value creation. Taking a look at our operations and service relationships provides us with another opportunity to be a leader in sustainable business practices with the resulting value for our shareholders. Your contributions will be critical if we are to create shared value and sustainability for our service businesses."
The council was being counted on to act and think differently and to function as a cohort in the identification of value added ideas for John Hancock Mutual Funds.
By discussing Walmart innovations and how their management teams worked together and how they collaborated with suppliers, we were hopeful that a transformation would take hold in how we thought about our own business by thinking differently to drive value creation and to identify unique practices.
The Spark Progress Contest
The council began to spread the word within the business about their involvement in idea generation and decided to run a campaign. "The Spark Progress Contest" would publicize the initiative and broaden the level of involvement across the company and attempt to increase the level of employee engagement in seeking innovations.
It was a success and there were a number of ideas that have been implemented or are in the process of being executed that will save on costs and drive shareholder value.
The winning idea was an online tutorial that is currently being developed for the JH website to assist customers with basic issues that would normally generate a call to our customer service center for resolution.
The Innovation Council is still in its early stages but the beginning returns are clearly favorable, both in the creativeness being exhibited by our professional staff and notably in the level of engagement to the business by the council members and their involvement with new and exciting ventures-separate and apart from their daily responsibilities.
The Way Forward
For the council to keep its momentum it is important that the organization continue to embrace a culture that is open to innovation, collaboration and change. Continuous sourcing of ideas and new best practices from other JH divisions as well as outside companies and industries is also paramount to future success.
The council members also have to continuously re-examine the shifting business landscape and adapt to ongoing change, as this is an evolution. Thinking creatively and incorporating innovation has no boundaries.
Charles A. Rizzo is chief financial officer of John Hancock Mutual Funds.