Interview with Pnina Keren, the director of Human Resources and Administration Department in the Central Bank of Israel
Human Resources and innovation are closely linked. For innovation to flourish, it requires a certain environment in which ideas can grow. HR, the department in charge of creating the organizational culture, can contribute or hinder this process enormously.
One aspect in which HR is critical for innovation is the department itself. Pnina feels that in many cases, the people who are in charge of HR are not innovative enough themselves, do not place enough emphasis on managing different generations differently and see the HR role more in the traditional sense-meaning a more technical infrastructure role. Pnina says that as long as HR holds this view they cannot become leaders and shift their organizations to be more innovative.
In order to fill that leadership role, Pnina believes that the best place to begin is in the hiring process for HR personnel. While innovation training can be conducted, and tools gained in training, it is often a tough skill to master if one is not already inclined to it. It also requires some “managerial guts” to change the organizational culture. Once you look for new hires with innovation leadership in mind, it becomes much easier to establish that leadership.
HR as leading innovation.
Another role HR has in fostering innovation, once the right attitude and people are place, is to lead organizational wide innovation. Pnina doesn’t think it is always the right call to have innovation under the people who manage the organization’s technology (which Pnina sees as a tool for innovation) or as a separate entity, as often happens in organizations.
HR are in charge of the human factor in the organization—from junior employees to senior management. Innovation is first and foremost about the human factor, both in terms of fostering the right environment to create innovation and in working with managers to promote innovation in their own departments.
Encouraging Innovation in the hiring process
Like with the HR department itself, creating an innovative organization starts at recruitment. The interview and recruitment process needs to place an emphasis on innovation. Pnina mentions what you often see is HR people who place a great emphasis on specific professional skills, and while those are important, Pnina recognizes and encourages a shift to emphasis on the candidates’ personality, which is directly linked to innovation. It takes a certain personality type to create innovation. This personality type is often also linked to creativity and to broad thinking.
When hiring for the bank, hirers also place a great emphasis on innovation. Part of the recruitment process includes a series of tests or simulations which present scenarios and see how well a candidate can handle them and how comfortable a candidate is with thinking and doing outside the box. Are they proactive or reactive about it? This will translate to the question of: Will they know to initiate innovation, or will they be forced into it?
Pnina also warns that if you do hire innovative people but put them in an organizational culture where they cannot innovate, it may cause frustration and a faster rate of departure, so culture and recruitment must go hand in hand.
Creating a culture of innovation
There are many ways to create a culture of innovation. The bank, for example, is building a physical environment which encourages people to step out of their everyday workload and work collaboratively and creatively. They created the “brain workout room” or “happiness workout room”. The creation of the room itself is one of the innovative projects the bank is launching–a group of volunteer employees are designing the room and will be in charge of managing it themselves. Employees will be able to use the room as a bubble, separate from the rest of the bank, with optimal conditions to encourage creativity. Pnina sees the room as a message to all employees that the bank wants to promote innovation.
Another aspect of innovation culture is openness. The bank’s HR unit is now in the process of creating an innovation organizational structure that can work around the corporate bureaucratic structure which might delay and deter innovation. Pnina and her department created a channel where managers and employees can come to them and (with their managers’ knowledge) to push forward innovation projects. This is the first time the bank is breaking its very strict silos and allowing people from different departments to work together.
This collaboration is the key to succeeding in innovation. Pnina believes that innovative people know how to find the best partners and form groups that can best transform their ideas into action, and these people are often in different departments.
In addition to space, direct channels and collaboration, Pnina says that in order to create an innovative culture, action and a rapid work pace that brings results are crucial elements. It proves to the next group that innovation can happen.
Just as important as all the aforementioned components (if not more so) is senior management that understands the importance of such innovation. Pnina says that for them, Director General Hezi Kalo’s support is crucial. Kalo, who comes from an HR background, is the standard bearer of innovation in the bank. He introduces new technologies and pushes other managers to remain innovative in their fields.
Innovation is not a clean-cut process and involves many moving parts and different entities within the organization, but from recruiting to creating an innovation culture to involving the managers, HR plays a crucial role.