Do Regulated Industries Resist Innovation?
The old innovators mantra of moving quickly and breaking things seems like a questionable fit for industries that are bound by inflexible rules and regulations. That said, companies that manage to fit some innovative traits into their organizational DNA have the potential to gain a leg-up on their rivals. They simply have to go about the process carefully.
The Harvard Business Review specified that business leaders in heavily regulated industries should become familiar with their legal departments, bringing these gatekeepers into the loop on developing new processes. (Jun. 12, Fried) When managers develop good team chemistry with the people most familiar with the laws, they can push processes forward within existing legal frameworks.
Furthermore, managers should be unafraid to stride into legally undefined gray areas and challenge the way things have been done in the past. It’s common for companies to hold to one way of doing things so closely that it becomes conflated with the law. However, there is sometimes more freedom than departments assume, and they’ve simply become prisoners of habit.
Company leaders can also gain headway with legal departments by watching competitors’ progress. While lawyers may not sign off on an unprecedented innovation, they could be much more lenient in cases where another organization has already taken a similar leap.
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