Australia: Managing the creative genius in an ideas boom era

What you need to know

• The Federal Government's push for Australia to become an 'Innovation Nation' includes a strong call to action for businesses in the life sciences and healthcare sectors, with clear emphasis being placed upon the importance of attracting and fostering great talent in science and technology.
• The question is, how can this best be achieved? It is unlikely to be through traditional 'people strategies' that are driven by risk and compliance or the tightening of reins, particularly with the rise of a new generation of workers with different ideas about how they want to work.
• We explain why 'flexible management' is the key to success, and also share brief insights on how it can be done without exposing the company to undue legal risk and and with an eye on protecting the valuable intellectual property produced by the 'creative genius' being flexibly managed.

The increasing mobility of people, changing patterns of work and the rising influence of millennials are radically impacting organisational culture and structure. To keep pace, people strategies are being challenged more than ever before as organisations are compelled to foster and empower innovation and creativity in the workplace while simultaneously managing increasing legal risks and compliance costs. This challenge has always been prominent in the life sciences and healthcare sectors, where the 'creative genius' can be and often is a key ingredient to the success of an organisation.

When Prime Minister Malcolm Turnbull announced the Federal Government's National Innovation and Science Agenda in December 2015, he introduced the concept of an 'ideas boom' and declared "unlike a mining boom, it is a boom that can continue forever, it is limited only by our imagination". It therefore comes as no surprise that a key focus of the Agenda is an investment in people and talent.

In this regard, the Federal Government proposes to commit significant funds to initiatives aimed at:

• encouraging women to embark on and remain in careers in science, technology, engineering and mathematics (STEM)
• inspiring a 'nation of scientists' from those of pre-school age to the broader community to engage with STEM and to participate in STEM study, and
• attracting people with entrepreneurial talent and skills from around the world to Australia with the introduction of an Entrepreneur Visa.

The Federal Government's emphasis on an 'ideas boom', accompanied by the Agenda's focus on people and talent, crystallises the need for organisations operating in the life sciences and healthcare sectors to embrace innovative people solutions. From start-up medical technology companies striving to get off the ground, to well-established pharmaceutical organisations undertaking research and development, all will need to adapt in order to fully seize the opportunities presented by this rapidly evolving era of business – and to avoid being left behind.

Out with the old

Traditional people strategies focus on addressing and minimising legal risks, but they often fail to give managers the flexibility necessary to engage and manage the 'creative genius' in a way that positively harnesses their strengths and enables them to thrive with their work.

Taking performance management procedures as an illustration, we can see the way in which people strategies can either inhibit or promote the 'creative genius'.

Organisations commonly adopt performance management frameworks which impose a prescriptive step-by-step procedure when managing under-performing employees – a procedure which is often premised on the rule of 'three strikes, and you're out'. These frameworks have generally been accompanied by formal year-end performance reviews requiring managers to evaluate employee performance in accordance with prescribed performance indicators, which are often a 'one size fits all' set of requirements that remain the same from year to year, despite changes in an organisation's strategy, culture and operating environment.

There is no doubt that these prescriptive performance management processes are risk and compliance driven, particularly intended to minimise the organisation's exposure around the increasing myriad of legal claims available to employees, including workers compensation, bullying, general protections and unfair dismissal claims. In addition to the legal risks and compliance costs faced by an organisation, HR managers and decision makers can be held personally culpable if an organisation breaches its legal obligations resulting in exposure to civil penalties and reputational damage.

In with the new    

These types of traditional approaches will need to give way to new alternatives if businesses want a fair shot at attracting and retaining good people.

It would be somewhat extreme to advocate the complete removal of all organisational rules, policies and procedures, catering to the individual above all else. Instead, the key to managing the 'creative genius' is to retain sufficient flexibility in those rules, policies and procedures. The solution is not 'no management', but 'flexible management' that enables managers to adopt an individual approach while maintaining compliance standards. For example, flexible performance management processes based on ongoing feedback, continuous development and a focus on managing to strengths, not weaknesses, can inspire the 'creative genius' while nevertheless maintaining checks and balances to minimise risks and ensure compliance.

Deloitte's Global Human Capital Trends 2015 survey reveals that organisations can achieve the shift from a prescriptive to a flexible performance management process through:

• change management strategies to transform cultural perceptions around performance management, gravitating from an emphasis on top-down evaluation to continuous development
• training for managers to equip them with the skills necessary to embrace and adapt to change, and to effectively coach and evaluate the 'creative genius', and
• giving managers the authority to recognise and reward employee performance throughout the course of the year, which will reinforce the shift toward a culture of continuous improvement.

For the 'creative genius' to thrive, organisations need to implement a strategy and culture which is supportive and encourages creativity and risk-taking instead of a culture with an emphasis on disciplinary action for non-compliance with rules, policies or procedures.

Protecting the intellectual output from the 'creative genius'

In evaluating how best to implement innovative people strategies that allow the 'creative genius' to flourish, it is critical to also think about how that person's creative output will be managed.

As the success of a business in the life sciences sector often turns on the intellectual efforts of those involved in research and development, the importance of capturing, protecting and extracting value from the 'creative genius' cannot be understated. This requires a comprehensive intellectual property (IP) strategy which is aligned with the organisation's business goals. An IP strategy should span from the recruiting stage until after the 'creative genius' has departed the organisation.

Key components of an effective IP strategy include:

• employment contracts (with detailed job descriptions, provisions dealing with IP ownership and moral rights, and obligations to assist with filing of patents and other registered rights, both during and after employment)
• clear and well-understood policies regarding disclosure and use of IP (of the organisation as well as third parties)
• commercialisation strategies (including any benefit sharing with inventors and creators), branding and trade mark use guidelines, and enforcement of IP rights.

Flexibility – the key to success

How an organisation encourages and supports the 'creative genius' will necessarily vary depending on the individual and the organisation, and will evolve with the organisation's strategy and culture. Some of the innovative strategies that organisations are already introducing to create a work environment that is conducive to creativity and innovation include:

• flexible hours, patterns and places of work
• unique remuneration structures
• bespoke (not 'one-size-fits-all') learning and development initiatives.

The key to successfully finding the right balance between flexible and innovative people strategies, managing legal risks and protecting intellectual output is ensuring that the culture, values and leadership of the organisation are strong. Where an organisation is strong in these areas, compliance will always be better and the organisation will have the freedom to loosen the reins and give the 'creative genius' the flexibility they need to create and innovate.

This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this article. Authors listed may not be admitted in all states and territories