A conversation with Kris Pennella, Director of Red Hat’s Open Innovation Labs

Kris Pennella, Director of Red Hat’s Open Innovation Labs, is on a mission to assist companies in getting products to market faster by transforming their organizational structures.

As someone on my own mission to put a stop to bad meetings by innovating organizations’ meeting cultures, I was excited to speak with Kris about how she utilizes innovation to drive corporate cultural change.

Kris Pennella.

I spoke with Kris about eliminating silos that bar communication between teams within an organization, how to know when an organization is on the precipice of cultural evolution, and the significant value the consumer plays in driving innovation.

The North Star

Several times during our conversation, Kris highlighted the importance of working cross-functionally within an organization. Creating silos, she says, causes organizations to overlook valuable, innovative solutions from the minds of employees outside of pigeon-holed teams or departments. “The team in the mailroom could have a great idea about how to be more operationally efficient about part of their job, which could snowball into leaving time for more efficiencies and abilities to innovate across the organization,” she said. “Good ideas can come from anywhere.”

Cross-functional teamwork doesn’t just happen, though–it must be built into the culture of the organization. Breaking down the silos teams have built themselves into takes more than sending a few members of each team to sit in a room behind closed doors. Kris stressed to me how crucial it is in her line of work to cut through an organization’s structural norms and get different departments comfortable working together. One of their secret weapons for this is weekly program updates.

Red Hat Open Innovation Labs.

“When we are working with clients in a timebox innovation accelerator, we send out weekly program updates internally to the organization… If folks feel like they are in the communication loop, and they’ve got some modicum of ownership, it helps with that greatly. It starts opening their minds, ‘Oh, I could be next. I could work on all of these impactful projects. Yeah, I’ve got some ideas.’

The key to internal communication between departments, Kris says, is being clear about why new ideas and changes in workflow are happening. This is one of the first series of questions she asks when beginning to work with a new client: “Why are you doing this? Why do you want this? What is the challenge you are looking to address with this?” Having a clear goal allows a central point for all members of the organization to rally around, regardless of their unique role. She calls this the North Star because it helps everyone understand where they’re going and travel there together.

The Tipping Point

Even with a bright North Star leading the way, not everyone in an organization is going to be excited, or even willing, to change the way they work. Kris says this is one of the first things she considers when working with a new organization. A program should be built around the company’s willingness to change their ways of working, she says.

“Everybody doesn’t necessarily want to change the way that they work or think about that world in any way, regardless of the fact that there are good ideas everywhere. Some folks are just comfortable in the same old same old, and business as usual, and that’s okay for them. So, getting them excited is really the interesting challenge in doing the work that we do.”

Kris Pennella at work.

Kris’s weekly program updates play a part here as well. “We work with the C-Suite to develop messaging that goes out communication-wide around why they’re doing this change, why it’s important organizationally,” she said. When organization members understand why changes are happening and how they are going to help them reach that North Star, they are more willing to adapt.

Companies that Kris works with vary widely in their openness to change. Some are hesitant, sheepishly dipping their toes in the water while others can be a little overzealous, diving in before checking on the depth of the water. “It’s about kind of meeting them where they’re at,” Kris said.

When I asked how she knew when an organization was on the precipice of change without even realizing it, Kris told me the telltale sign is when upper management, especially at the executive level, starts to listen to influencers lower down the ladder. “When the executives are starting to take notice, that’s where the tipping point is.”

Innovating Culture, Not Just Product

Kris says companies that innovate their entire organization and not just a product are getting innovation right.

“It shouldn’t just [be] one group that’s sitting behind the closed door and being the innovation empire. It should be a cultural change of ‘good ideas can come from anywhere.’ You build [innovation] into your ways of working so that there is the ability to give folks the breathing room to adjust.”

Red Hat Open Innovation Labs.

Cultural transformations are not one size fits all, she told me. Just as organizations differ greatly in their willingness to change, they differ in both how they are currently working and how they want to work. Kris says understanding how these things affect a company’s ability to get a product to market is how her team builds their programs.

A huge catalyst to cultural changes is the introduction of a new generation to the workforce; organizations are being pushed to change based on the evolution of how employees want to work. Kris told me she finds this disruption exciting. “One of the things that I’ve seen is some of the generation, the team members coming out of college and maybe a couple years out of college…they’re inherently more open and agile. They were brought up very culturally different than the generations before them.” She says she sees this within her own team and it’s been a huge asset. “They’re just working in a whole different way than some of us have been…While we are technology focused because we are supporting the Red Hat suite of products on a platform, my team beyond that is a group of musicians, artists, electronics geeks and master chefs. Quite a few of them have other creative interests that they draw upon, which I believe helps strengthen us as a team on a day to day basis.”

While some organizations are, like Kris, excited about the change in work brought upon by generational changes, others are worried about how it will change their ability to attract and retain new talent. Kris responds to these concerns by reemphasizing the need for cultural innovation.

“Part of my discussions with the executives is, ‘Well, what is your culture like? And what would bring them into the company and interest them in working with you? Is it some opportunity to work on some emerging technology and create products on that platform? Is it the opportunity to be able to create and contribute? Do you have that culture?’

The current disruptive pandemic situation has created additional complexities with consideration for innovation drivers. However, disruption is an opportunity to quickly uncover where some of the most challenging opportunities are for innovation. It is possible to gain insights and drive similar feedback loops. To do so does require additional effort in communication, context and collaboration.

Delivering Value to the Customer

Innovation is all about delivering value to the customer based on a specific goal, Kris says. She also shared that innovation doesn’t come from a cubicle, but rather “getting out and talking, hashing through your ideas.”

During Kris’s time as CEO and Founder of a company that produced grab & go specialty foods, hashing through ideas meant following customers around grocery stores and observing their buying patterns. “One of the ways I would do my market research was literally to follow people around and watch them shop. You just learn a lot from watching folk,” she said. Something interesting that she noticed? Customers are more likely to buy prepared foods during times of economic hardship. “During times of downturn or instability like we had in 2007-2008, people were scaling back on going to restaurants, but that didn’t necessarily mean that they wanted to cook….[Spending] on high end prepared foods actually increased.”

Finding value that can be delivered to the customer can happen through more direct means than watching shoppers from afar, however. Kris spoke to me about how useful it is to speak with customers directly. “Folks inherently, they want to help,” she said. “Even if they’re giving you terrible feedback or being very blunt or don’t like your idea, they still think that they’re helping and there’s value in understanding that.”

Kris Pennella at work.

When I asked her for an example of an innovation that failed to deliver value to the customer, Kris said New Coke; “What was wrong with old Coke?” she asked.

“Why did they feel that we needed a new version of it? What were the market drivers that drove the executives at Coke saying, ‘Hey, our 100 year old recipe is getting dusty. Let’s go release a new version that nobody is asking for [and] might not like or want.’

While receiving customer feedback on possible innovations or changes is crucial, Kris recognizes the impracticality in focus-grouping every small decision. She recommends developing a streamlined feedback cycle that is established upfront with the community or teams you’re asking for feedback. “What’s the right cadence for who your customer is?,” she asks.” It’s about setting those expectations and that rapport up front.”