By Eitan Sharir

On a Monday in July, a pair of newlyweds headed to Grouse Mountain to meet and greet their guests for the reception atop the peak.  When new groom Greg and his bride Aleta arrived to find the gondola out of commission due to high winds, the reception seemed a foregone failure.

Two hours later, a complete wedding reception had been arranged, from catering to decor to entertainment—and a magical day rallied to new heights, albeit on ground level at River Rock.  Everyone jumped back in their cars, headed to Richmond and the big day did not miss a beat. It was as if the reception had been planned that way all along.

How did River Rock Resort pull off such a feat?  Why did Greg not hesitate to effectively ‘head back to work’ on his wedding day?  They could do it because they have worked hard to build a vertical organization and instill a strong culture of innovation.

What Is a Vertical Organization?
A vertical organization is most often depicted by a traditional hierarchical pyramid of roles and responsibilities.  In a similar but contrasting light, horizontal organizations are typically depicted as ‘flat’ insofar as there is more autonomy and an absence of middle management.  Both of these archetypes benefit from a revision of the paradigms they support.

Herein is a more upwardly mobile definition of the vertical organization as a driver of ongoing innovation.

A vertical organization is an organization that is clear and committed to its purpose, its vision, its mission and the strategic business plan that forms the roadmap to achieving excellence. Through this vertical business strategy, a strong leadership team mobilizes the entire organization to be engaged, equipped and inspired to deliver superior performance results.

A vertical organization is:
1. Constantly moving forward
2. Creating and innovating
3. Aligned to the vision and values
4. Committed to deliver excellence
5. Focused and resilient
6. Accountable
7. Collaborative and highly engaged.

All of the above qualities contribute to a culture of innovation.

A vertical organization is constantly moving forward, innovating and charting new territories. The teams are focused on their goals and feel responsible and accountable for their piece of the company’s vision.  They are led by strong leadership and management teams which have the capacity to influence and inspire their people to create excellence collaboratively. This excellence translates into value for their employees, their customers and their shareholders.

A vertical organization does not happen by chance. It is carefully crafted by a strong leadership team that is aligned and fully committed to creating an organization that achieves beyond anything that has ever been achieved before. This leads to increased loyalty, a sense of ownership and pride in being part of something meaningful, significant and inspiring.

What is Vertical Innovation?
Every organization strives to achieve a culture of innovation that supports the type of growth we see in companies like Apple and Google.

Why do organizations strive to create this culture of innovation? Because innovation is necessary in order to create, move forward and lead the industry. If you’re not innovating and unique, you become a commodity. And if you become a commodity you become cost sensitive and your margins will be squeezed. Innovation is not a “nice to have;” it’s a necessity.

Typically, to come up with this type of innovation, the executive team sits down and crafts a vision, mission and purpose statement designed to inspire it.  Unfortunately, simply telling people they need to innovate doesn’t work. Innovation is more than an intellectual construct.

Before any type of meaningful or significant innovation can be achieved, you have to first create a vertical culture and mindset that is focused on excellence. Furthermore, every employee needs to be activated.

Organizations that achieve a culture of vertical innovation are able to access the creative impulse that every employee possesses. Employees are energized, focused, inspired by something that is meaningful, and have the desire to constantly create, improve and move forward.

This type of culture produces innovation that is positive and collaborative. Employees and teams feel they are all working together to achieve a common goal and they are fully engaged with the task at hand, constantly learning from past experience and focused on creating a better future.

Horizontal Innovation Differs in Impetus and Impact
Clearly, most organizations aspire to be vertical; you can see this reflected in their vision, mission and purpose statements. However, few actually take the action that is needed to become more vertical.

In a horizontal organization, people still innovate but the motivation is different. Employees are driven less by the motivation to achieve something meaningful and significant, and more by fear. They fear that they will not achieve their desired goals, that the competition will win, or that they will lose their jobs.

A horizontal organization does not nurture collaboration or inspire employees to activate their creative impulse. Instead, in a horizontal organization, employees are focused on their own personal agendas, often causing competition amongst employees.

Innovation is Not Change
In horizontal organizations, you will still see quite a bit of change, but it’s important not to confuse change with innovation. We’ve all heard the saying, “Don’t just change for change’s sake.”  Change without purpose is wasteful, disruptive and meaningless.

So how are innovation and change different? Innovation is about moving forward. When organizations are constantly innovating, they stay ahead of the game. And for the competition, it’s difficult to catch up. As soon as they do, the vertical organization is already on to the next phase.

With change, on the other hand, you can move a lot of things around but not actually move forward. You may change some things without actually improving a process, or achieving a goal. You are still in the same spot, but you’ve spent a lot of time and effort to get there.  Imagine taking a liter of water in a blender and pressing the on button. For a minute, the motor works very hard and water goes wild in the container. Then you press the off button. In a second or so, the water settles and is in exactly the same state it was in before all this energy was used to move it. This is change.

Unlike innovation, change can use up a lot of energy and create many issues and distractions, but at the end of the day you find that nothing much has moved forward. Change for change’s sake can be very frustrating for employees; it can ruffle a lot of feathers, upset people and even create fear, distrust and insecurity.

Seven Steps to Building a Vertical Organization
In order to build the type of vertical organization that supports a culture of innovation, you need to move beyond simply creating a vision, mission and purpose statement. You have to activate what you’ve put on paper by building a vertical mindset and culture across the entire organization.

There are seven key steps that are required to create an innovative vertical organization.  The first three focus on building the foundation of a vertical organization:

• Vertical Business Strategy: Create a clear and differentiating strategic plan.
• Vertical Culture: Engage and enroll every employee to be committed, accountable and inspired toward achieving a common goal.
•  Vertical Leadership: Build a strong executive and management team that is focused on influencing and inspiring excellence.

The final four steps are focused on rolling out this new strategy across the entire organization:

• Vertical Selling: Develop a sales culture of excellence that accelerates revenue generation.
• Vertical Customer Service: Equip your customer service teams to deliver your unique ‘Service Excellence Experience’ for growing and sustaining loyal and repeat customers.
• Vertical Operational Effectiveness: Organize your entire organization to operate with maximum efficiency and the highest return on employee investment.
• Vertical Organizational Capability: This is the glue that bonds the entire system to deliver sustainable results and includes optimized structure, superior job design, standards and discipline and effective systems and processes.

Commit to Innovate
Building a vertical organization takes dedication and commitment, but is necessary to achieve the type of innovation that will keep you constantly ahead of the game and the competition.

It also creates the type of culture that makes your employees want to come to work every day and empowers them to take action. It attracts the right kind of attention both internally and externally.

Case in point, River Rock Casino Resort was able to save the day for Greg, Aleta and their wedding guests. Imagine the type of goodwill this created, not only with the wedding couple, but with their 200 or so guests.

Moreover, as I finish this article, River Rock have just been awarded “Best Luxury Casino Hotel Award” in the global category at the 7th Annual World Luxury Awards—after winning a similar award for Canada the year before.

At the heart of their success and recognition?

“It is through our rock solid team engagement and customer service approach that River Rock Casino Resort left a memorable mark on all the guests who supported our nomination and experienced what the resort has to offer,” said Roland Monteiro, general manager, hospitality, River Rock Casino Resort.

Imagine the positive impact on your business if your customers consistently received this type of experience.

Building a vertical organization is possible. What is required is commitment from the top: in action, not in words. Does your organization have this type of commitment?

Eitan Sharir is a Vancouver, BC-based corporate culture consultant, leadership coach, and performance excellence expert (dynamicachievement.com).  

(PeopleTalk Winter 2013)