Innovation and Islam

I spoke recently about innovation at a conference (organised by Continuum) of family businesses from the Middle East.

Many issues were raised by the delegates, but there was one that seemed to hang in the air unspoken. And it was this: does Islam itself have a dampening effect on innovation?

I have thought about this a good deal in the intervening days – and my tentative answer is that any dampening effect springs not so much from Islam, but rather from the very hierarchical nature of Middle Eastern society. And, of course, this is so often strongly present in family businesses.

After all, Islam is alone among the major religions of the world in having been founded by a trader. And the Koran is supportive of success in business – quite unlike the New Testament, which has practically nothing positive to say about the creation of wealth.

The powerful presence of respect for elders, within a command and control culture, always has a negative impact on the expression of new thinking and new ideas. This is true in all societies where hierarchy is a primary force – in Russia, China, India, the Middle East and elsewhere.

If these countries wish to grow dramatically in their capacity to innovate – which they all do – the question in my mind is not so much how to reduce hierarchy in general, but how to create situations where it is temporarily removed, so that people can express new ideas without fear of reprisal.

Innovation in India

The dramatic growth in the Indian economy, and with it the reduction of poverty and the emergence of millions into the “middle class”, is extraordinarily heartening.

My work in India and with Indians over many years has shown that entrepreneurship is right at the heart of the culture. In America, Indians are expected to be extremely rich. According to my friend Alyque Padamsee’s experience in Houston, on learning that he was Indian, a taxi driver asked Alyque (above), “Are you a billionaire?”

Of course, the cost base is still relatively low and educational levels high. Plus there’s so much energy deployed, physical and intellectual. So will growth continue unrestricted into the foreseeable future?

A factor that I envision becoming more and more of a barrier is the extremely hierarchical social structure, which operates within companies as elsewhere. In an article in Market Leader magazine (Summer 2008), Jitender Dabas wrote: “[Indians] either look up or down at other people; there cannot be a third way.”

I notice that in meetings Indians are reluctant to speak until they know the boss’s point of view on the topic at hand. And even then they are reluctant to contradict, even a little.

If change does not come about, this aspect of the culture will become a major block to innovation. And the ability to innovate will become more and more important, as people costs rise.

Shelf-stacking in Nuneaton

Of course, before I started real work, as a teenager I had a holiday job. It was at the Marks & Spencer's store in my home town, Nuneaton, around 1960-62, and I was a shelf-stacker.

But because what now appears to be called “logistics” was in its infancy, what I did in reality was shift the arriving goods manually off the delivery vans into the store-room and from there into the store itself. The company moved into chilled foods for the first time while I was there, so we installed lots of new equipment.

It all came to mind because it has been announced by the company that that shop is to close early in the New Year after 80 years in the Market Place - a “devastating blow”, according to Nuneaton News.

Although the technology and systems have changed dramatically in the intervening half century, the principles I learned then mean that I still understand the fundamentals of retail. (I don’t believe I mentioned this experience when I worked again as a consultant to M&S many years later.)

I also learned a good deal about how management hierarchy works. One of the greatest fears of the Nuneaton store manager, almost an obsession, was that the Midlands area manager, next door to God himself, should walk in unannounced to inspect, and would discover dog dirt on the shiny floor just inside the front doors. You know what happened next…