Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation (2018)

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47 While the literature review was helpful in framing innovation culture, the case study interviews provided many of the practical examples and helped refine the building blocks that form the basis of this guide. With 78 percent of the more than 300 transportation officials surveyed indicating that they admire private-sector companies for their ability to innovate, it was important to gather insights from the private-sector. However, because of the unique challenges that government agencies face, it was also important to gather best practices from the public sector. The state departments of transportation were selected for case study interviews to represent a broad range of numbers of employees, state population, geography, and types of services provided. The purpose of the case study interviews was to identify best practices of agencies that have successfully created or are sustaining cultures of innovation. Because every agency is unique, not all organizations referenced the five building blocks during their interviews. The five building blocks were a product of the research; therefore, only those points brought up during the inter- views are included in the case study summaries. Additionally, the FDOT case study was submitted through the Innovation Lab website, www.transportationlab.org, the site that was established to facilitate discussion and input into the NCHRP 20-108 research process. That case study is presented verbatim in NCHRP Web-Only Document 248. 5.1 Large DOT: Caltrans The California Department of Transportation (Caltrans) has 19,300 employees and a budget of $11 billion. Caltrans employees manage more than 50,000 miles of California’s highway and freeway lanes. Caltrans also provides inter-city rail services, and permits more than 400 public-use airports and special-use hospital heliports. Caltrans carries out its mission of providing a safe, sustainable, integrated and efficient transportation system to enhance California’s economy and livability through six primary programs: Aeronautics, Highway Transportation, Mass Transportation, Transportation Planning, Administration, and the Equipment Service Center. Interview Participants • Kome Ajise, Chief Deputy Director • Dara Wheeler, Chief of Staff • Julie Dunning, Office of Innovation, Risk & Strategic Management • Coco Briseno, Deputy Director, Planning and Modal Programs S E C T I O N 5 Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation

48 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation 1. Leadership • Innovation as a Core Organizational Value. Innovation is one of four agency-wide “values” embedded at Caltrans in its 2015–20 Strategic Management Plan, alongside “integrity,” “commitment,” and “teamwork.” The plan is built around a mission and vision, together with five core goals and related objectives [Caltrans(c) n.d.). Caltrans Director Malcolm Dougherty and his senior team see their leadership role in terms of linking the department’s core strategic direction to a push for innovation. • Spreading the Word/Walking the Talk. By labeling innovation as a core value and repeating this message frequently, Caltrans Director Malcolm Dougherty and his team make clear their public commitment from the top of the organization to building an agency-wide environment in which all department personnel, external stakeholders, and the public are empowered to adopt an innovation mindset. For example, Dougherty noted in launching Caltrans’ STIC in 2015 that “California’s infrastructure is aging and our resources are increasingly becoming limited, so the need for innovation is essential.” • Building Organizational Support Structures. Caltrans’s Division of Research, Innovation, and System Information (DRISI) reports to the director’s office, but rather than serving as an innovation niche, it seeks to play the role of coordinator for generating innovation across the agency. DRISI spearheads research, testing, development, and evaluation of transportation innovations that focus on safety, mobility and sustainability, improved management of public facilities and services, and protection of public investment in transportation infrastructure. 2. Empowerment • “Crowdsourcing Ideas” Website. Caltrans uses a third-party digital platform, Brightidea, to help its 19,300 employees innovate. The Brightidea hosted website give employees at any level a simple 24/7 way to submit, comment on, and vote for ideas. At Caltrans, the Brightidea system is used to select innovations with the most votes for further evaluation and implemen- tation. The idea of crowdsourcing innovation came in part from efforts to learn from how innovation works at technology businesses in California’s Silicon Valley. • Ideas May be Big or Small. An important feature of the Caltrans innovation philosophy is that small ideas are innovations too. Innovation might be something as simple as setting up a spreadsheet differently. • LSS Training. Caltrans is working to embed the principles and practices of LSS across the organization as part of its approach for empowering employees to innovate. LSS is a widely used collaborative, team-based, and data-driven business management philosophy for improving performance by systematically removing waste. Adoption of LSS requires extensive training with a “belt”-based system showing mastery of certain skills. As of December 2015, 15 Caltrans employees were trained as LSS Green Belts, with a plan to add 10 additional Green Belts every year through 2020. A Caltrans green belt candidate is usually a top performer who embraces the opportunity to drive transformational improvements in their work areas, while having excellent leadership skills and technical abilities. The Green Belts are trained in the LSS tools and receive one-on-one mentoring from a trainer who is a Master Black Belt. • “$25k—Find a New Way” Campaign. Caltrans is also seeking to empower the public through its “$25K—Find a New Way” innovation contest, which began in 2015. The department awards up to $25,000 annually and three first-place winners for 2015 were awarded $7,000 each for their “Advanced Directional Sign” suggestion to enhance safety and efficiency by using left and right markings on highway approach signs. The changes will provide an earlier Caltrans was recommended by the survey respondents as an organization with an innovation culture they admire. For example, the organization has launched “Find a New Way” contest in which the Californian with the best idea for how to improve transportation is awarded $25,000.

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 49 indication of which lanes motorists need to enter for desired routes. A second-place winner was also awarded $4,000 for their idea to develop an online travel app to encourage smart travel habits. Coverage of the innovation contest was posted on the Caltrans YouTube channel [Caltrans(a). n.d.]. • A webpage called “Just Do It” lets staff login and record innovations they have attempted at work. 3. Communication • “Just Do It” Branding. The internal/employee-only innovation crowdsourcing website is branded as “Just Do It.” • Innovation “I-Fairs.” For the past several years, individual Caltrans districts have organized their own annual innovation fairs at which innovations the district has undertaken to address a wide range of issues are shared and highlighted, including safety improvements, congestion reduction, efficient project delivery acceleration, higher quality infrastructure projects requir- ing less maintenance, carbon footprint reduction, and response to climate change. Caltrans leadership attends innovation fairs, and presentations from I-fairs are available online, so all staff are able to stay well-informed of industry innovations. • YouTube Channel. Brief videos on a wide range of topics, including innovation, are posted publicly to Caltrans’s YouTube channel that also showcases select innovations [Caltrans(b) n.d.]. 4. Recognition and Reward • Caltrans “Medal of Value” Award. This award recognizes top innovations and their creators annually. 5. Measurement • LSS Measures. Caltrans measures progress in employee training and cost savings as a part of the LSS program. • Strategic Management Plan Measures. One of the strategic goals included in the Caltrans Strategic Management Plan is to “promote a positive work environment and implement a management system to maximize accomplishments, encourage innovation and creativity, and ensure staff performance is aligned with department and state strategic goals.” The measures associated with this goal that address innovation culture include: – Percent of Caltrans employees who agree, or strongly agree, that employees are encouraged to try new ideas and new ways of doing things to improve Caltrans—with a target to reach 75 percent by 2016 and maintain a level of at least at 75 percent through 2020. – Number of “Superior Accomplishment Awards” and/or “Merit Awards” given each year that specifically recognize innovation and creativity. – Percent of employees with performance plans that emphasize innovation and creativity, and that support organizational goals. 5.2 Public Sector: City of Los Angeles Ashley Hand was appointed as the Transportation Technology Strategist for the City of Los Angeles, Department of Transportation in August 2015. She is working via a one-year fellowship, funded by the Goldhirsh Foundation in partnership with the Mayor’s Fund of Los Angeles, to develop public policy and pilot projects in a rapidly evolving mobility landscape with an emphasis on shared use mobility, user experience, and autonomous vehicles.

50 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation Previously, Hand served Mayor Sylvester “Sly” James as the first Chief Innovation Officer of the City of Kansas City, Missouri, becoming the first female municipal CIO in the coun- try. Working collaboratively across departments, she focused on process improvement through strategic planning, staff involvement, and the use of Lean methodology and design thinking. In addition, she championed an unprecedented public-private partnership to make Kansas City one of the most comprehensive smart cities in North America by bringing digital infrastructure to a new streetcar line in the downtown core. Interview Participants • Ashley Z. Hand 1. Leadership • Recognize Changing Context in Which DOTs Operate. The role of the DOT is changing from primarily infrastructure construction to that of mobility manager. This requires innovative data-driven thinking and flexibility in leadership structures to allow good ideas to come forward, especially with regard to the procurement processes. • Set Proactive Attitude Toward Innovation. Leadership’s job should be to set the big picture challenges and to help employees ensure that their ideas can be assessed with metrics to support implementation and evaluation. This creates an achieve- ment culture in which employees are proactive, rather than waiting for direction. • Rely on “Early Adopters” to Form an Innovation Team. To spur innovation, establish a team that represents different levels and different disciplines in the organization. Often, an effective innovation team can be composed of early adopters within the agency. • Office of Extraordinary Innovation. LA Metro (Metro) is the major operator of bus and rail service in Los Angeles County. In 2015, Metro created an Office of Extraordinary Innovation (OEI). The small OEI team is a clearinghouse and creative engine for inventive plans, practices, and thinking. It consults with experts in local, national, and international academia, along with those in the nation’s transportation and policy think tanks as well as senior transportation veterans. OEI began a com- prehensive strategic planning process that included input from the Metro Board of Directors, employees, stakeholders, and local and national partners to help set the strategic direction of the agency for the next decade or more. OEI reports directly to Metro CEO, Phil Washington. Responsibilities of the office include: – Informing the high-level vision for Metro through exposure to innovative people, organi- zations, and industries. – Supporting Metro departments in piloting new and experimental programs and policy. – Serving as the primary liaison for new ideas relevant to Metro and the transportation industry coming from entrepreneurs, established private-sector entities, academia, or individual citizens. 2. Empowerment • LSS Training. Workforce training is essential and should be advocated by leadership. Training in LSS practices empowers lower- and mid-level management to implement practices, thus empowering the entire workforce to bring good ideas forward. • Innovation Fund. The City of Los Angeles created its first-ever Innovation Fund. The $1 mil- lion fund is designed to provide one-time funds to city departments to test new ideas that could The City has created its first- ever Innovation fund. This $1 million fund is designed to provide one-time funds to City departments to test new ideas that could make the City function more efficiently. Survey respondents cited the City of Los Angles as one of the public entities they admire for innovation.

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 51 make the city function more efficiently. The Innovation Fund supports projects that have not been previously tried in Los Angeles, that increase efficiency, that improve quality of life, and that are feasible and measurable. The fund is managed by the City of Los Angeles Innovation and Performance Commission, which is dedicated to improving the responsiveness, efficiency, and quality of city services. The Commission makes recommendations on the use of the Inno- vation Fund and sponsors awards that recognize innovation within the city. All city employees and city commissioners can submit an idea through the web portal at http://innovate.lacity.org. 3. Communication • Do Not Rely Only on Email. Communication is essential to creating an innovation culture. Employees become more empowered when they have greater awareness about innovation occurring throughout their organization. The City of Los Angeles embraces multiple media for communication; in particular, they have found they cannot rely only on email, since many frontline staff do not have easy email access. Communications such as inserts in paychecks and postings by water coolers and punch-card areas have been effective alternatives. 4. Recognition and Reward • Reward Employees. Rewards are a great way to motivate employees to innovate. Each year, the reward for top innovators within the City of Los Angeles includes “Lunch with the Mayor,” a feature on local TV, and “shout outs” on the DOT social media. It is also important to recognize employees who consistently innovate via career advancement promotions. 5.3 Private Sector: Google Google Project Manager Mike Capsambelis’s objective is to harness information to assist people around the world with the things they do every day. He has worked on several Google teams, including Social Impact, Shopping, Product Reviews, and Ads. He is also an active member of Google’s Community Outreach team, which works to connect nonprofits, commu- nity development organizations, startups, and entrepreneurs with the resources to accomplish their goals and make an even bigger impact. Outside Capsambelis’s Google “day job,” he is committed to accelerating economic and com- munity improvement through innovation and entrepreneurship. This means extending to all small businesses, nonprofits, and entrepreneurs those opportunities that propel Google’s most successful startups—and equipping them with the resources to grow, thrive, and compete in the current economy. This also means experimenting with new models, teaming with unconven- tional partners, and overcoming assumptions about the “way things are done.” He is the founder of Awesome Pittsburgh (awesomepgh.com), which awards $1,000 grants to people and organi- zations with the best ideas for making the Pittsburgh region stand out in the global economy, for connecting our communities, for celebrating art or technology, for making the community a better place to live, work, and play, or for simply surprising and delighting fellow Pittsburghers. Interview Participants • Mike Capsambelis, Google Project Manager 1. Leadership • Leaders Set Google’s Strategic Goals and Let Innovation Follow. Leadership’s approach at Google is to set out broad strategic goals and then step back to let employees innovate to

52 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation achieve them. Setting the right challenges for employees to focus on is an important leadership role that is instrumental in creating and sustaining Google’s innovation culture. • Use Objectives and Key Results (OKRs) Planning Tool. Google finds that OKRs are a practical project management method (also used by other technology companies including Uber, Twitter, and LinkedIn) for defining and tracking work objectives and their outcomes. OKRs are an anchor for promoting innovative thinking. OKR planning ensures company, team, and personal direction are constantly aligned and can be tracked, thus helping people move together in the right direction. OKRs are kept public in front of everyone, so that teams move in one direction and know what others are focusing on. Many tech companies, including Google, suggest that employees should achieve about 70 percent of their OKRs each quarter. • Leadership Must Show Follow-Through. When employees develop ideas for how to solve challenges, leaders must acknowledge and act on the ideas to ensure they are implemented. Employees will lose interest quickly if no action results from their proposals for innovation. In general, the innovation culture at Google thrives in part because managers and leaders learn to say “yes, and . . .” to their teams rather than “no” or “but.” This response to new ideas encourages employees to keep bringing new ideas forward and helps them fine tune ideas to best meet challenges. 2. Empowerment • Problem-Solving Mindset Favored. Unsurprisingly, Google is a workplace where a problem-solving mindset is highly prized. Groups of employees typically work in small teams on well-defined problems, and organizational hierarchy takes a back seat to the ability to problem solve. • Think 10x. According to the G-Suite article on “Creating a Culture of Innovation at Google,” the notion of “10x thinking” is at the heart of how innovation happens at Google (Google for Work n.d.). 10x means true innovation happens when you try to improve something by 10 times rather than by 10%. As an example, the article describes Google’s self-driving car project, which started with a blank sheet of paper and asked, “what if it could be easier and safer for everyone to get around?” A 10x goal forces you to rethink an idea entirely. It pushes you beyond existing models and forces you to totally reimagine how to approach it. • Innovation Is Not Dictated. Innovation cannot be achieved simply by following formulaic steps, such as a “tech” style office space (open floorplan, more collaborative) design. It is about switching employees’ mindsets from “tell us what we should do” to “let us figure out how to solve the problems our company faces.” Any effort to introduce an innovation culture runs the risk of mimicking, but not creating a culture; the work must be put into actually developing an innovation culture. Large organizations often struggle with how to empower employees. • Test Ideas and Fail Fast. A successful innovation culture is one in which employees not only continuously generate ideas, but are able to test them fast. This means they must set param- eters on how to judge success and be ready to move on if ideas do not meet expectations. Setting and reviewing OKRs quarterly helps employees establish a routine procedure for this process of testing and failing or succeeding fast. In her book Eight Pillars of Innovation, Susan Wojcicki, CEO of Google’s YouTube, says, “it’s okay to fail as long as you learn from your mistakes and correct them fast. Knowing that it is okay to fail can free you up to take risks. And the tech industry is so dynamic that the moment you stop taking risks is the moment you get left behind.” (Wojcicki n.d.). Google was one of the top recommendations from survey respondents for innovative organizations they admire. Google states that the goal of its technologies is to “make it as easy as possible for you to find the information you need and get the things you need to do done.” Google places an emphasis on innovation in its culture to best meet the evolving needs of its users.

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 53 • Use Iterative Innovation to Manage Risk. Throughout Google’s history, the company has followed a philosophy of making its new products “beta launches” and then making rapid iterations as users describe what they want more (and less) of. Today, Google continues to listen carefully to user feedback after each launch and revises products based on feedback. The beauty of this approach, according to Google, is that you get real-world user feedback and never get too far from what the market wants. Perhaps they want the features you were planning to add next, or maybe something completely different. 3. Recognition and Reward • Tie Promotion to Innovation. At Google, successful innovation is a major driver for employee promotions. It is the innovators who move up at Google, and this provides a strong motiva- tion for employees to innovate as a way to boost their career trajectory. 4. Measurement • Always Measure. At Google, measures are the basis for determining the success of an idea, but the measures are not prescriptive. In some instances, an idea’s impact may be measured in terms of profit. In others, it may be in terms of customer satisfaction or user adoption rates. 5.4 Small DOT: Idaho Transportation Department The Idaho Transportation Department’s (ITD’s) strategic mission focuses on three areas: safety, mobility, and economic opportunity. ITD has jurisdictional responsibility for almost 5,000 miles of highway (or nearly 12,000 lane miles), more than 1,700 bridges, and 30 recre- ational and emergency airstrips. Also included on the state highway system are 30 rest areas and 10 fixed ports of entry. ITD also oversees federal grants to 15 rural and urban public transportation systems, provides state rail planning and rail-project development, and supports bicycle and pedestrian projects. More than 1,600 employees statewide carry out ITD’s commitment to provide safe and efficient travel. ITD is divided into four divisions: Aeronautics, Highways, Motor Vehicles, and Administrative Services. Interview Participants • Charlene McArthur, Chief Administrative Officer • Ashley Orme, Continuous Improvement Facilitator • Michelle Doane, Business and Support Manager • Trey Mink, Project Manager • James Bennett, District 4 Design and Construction 1. Leadership • Align Innovation with Agency Strategic Goals. Since starting at ITD six years ago, Director Brian Ness has established three strategic mission focus areas for the agency that include safety, mobility, and economic growth and opportunity. Leadership’s role at ITD in establishing an innovation culture emphasizes directing innovation toward ITD’s strategic goals. • Innovation Team. ITD has set up a strategic “‘innovation team” charged with directing innovation strategies organization-wide. The team is led by ITD’s Chief ITD has been named an Idaho “Innovative Company of the Year” finalist by the Idaho Technology Council. This recognition is due to an employee-driven effort branded “Innovate ITD!” So far, 240 ideas have been implemented, accounting for about $4.7 million in efficiency savings.

54 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation Administrative Officer and has no dedicated staff. Rather, innovation is owned by all employees and not relegated to a department or subset of the organization. • Let Innovation Flourish. “Innovation is the most constructive way to change and get better,” says Ness. “We do not reject ideas. Rather, we empower employees to look for innovation in all we do from basic, yet effective, process improvements to the most creative ideas.” • Align Employees. An important role for leadership is getting all managers on board. Director Ness often focuses on talking with employees about the importance of innovation during his visits to ITD districts and will visit one-on-one with managers to ensure they are aligned with his overall vision for innovation. 2. Empowerment • Avoid Micromanaging the Innovation Process. ITD very specifically seeks to take innovation out of the hands of senior executives and into the hands of employees at all levels. Initially, ITD’s Innovation Team would attempt to review, accept, or reject all innovation ideas. How- ever, employees at every level in ITD are constantly encouraged to submit their ideas, resulting in hundreds of ideas annually. The process of choosing which ideas to pursue is now based primarily on proof of whether they generate time and money savings or make processes more customer friendly at ITD. When an employee submits an idea through the Innovate ITD! SharePoint site, the Innovation Team simply acknowledges the idea was submitted. It is the responsibility of the individual who submitted the idea to coordinate with other staff who will be impacted by the idea to determine if it is aligned with the ITD mission, and whether implementing it will generate cost, time, or customer benefits. Innovation stewards and managers are strongly encouraged to reach out to staff who submit ideas to assist with evalu- ation and implementation. • Innovate ITD! SharePoint Site. To make innovation easier, the Innovation Team created a web platform using SharePoint that functions as a digital suggestion box. The form used for the idea submission requires submitters to quantify impacts in terms of hours or dollars saved. An autoreply email goes out to the person who submitted an idea through SharePoint, encouraging them to reach out to their innovation stewards. In addition to capturing ideas, the site tracks progress on ideas once they are implemented and shares results with other employees to encourage them to submit ideas as well. • Times 7. Times 7 is a feature of the Innovate ITD! SharePoint site that allows employees to search ideas by district, so that people in different districts can learn from each other and ideas can spread across the state. • Train Employees on Innovation. Training on how to innovate, and particularly on how to switch from a passive, process-oriented mindset of waiting for instructions to an active, outcome-oriented mindset that seeks out better ways, is essential for empowering employees to innovate. • Use Employee “Innovation Stewards” as Ambassadors. ITD established its “innovation stewards” initiative in October 2015 to help spread innovation throughout the department. Innovation stewards are often frontline staff who have the trust and respect of their peers and also share a passion for being “early adopters.” In addition to their regular duties, innovation stewards help other staff develop, submit, and implement innovation ideas. • Manage Risk. With most ideas, the greatest risk is violation of state or federal regulations. At ITD, employees are encouraged to consider regulatory constraints as they determine implementation strategies for their ideas. Sometimes, regulations actually prove to be less constraining than originally perceived. For example, ITD has implemented an idea for line marker painting that was previously presumed to be outside regulatory requirements for painting equipment.

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 55 • Ensure Employees See Ideas Are Implemented. ITD has found that an innovation culture gains momentum when employees see their ideas getting implemented. For example, employees joked about using quadcopter drones to inspect bridges, but they were empowered to take the idea seriously. The idea submitted through Innovate ITD! was to use the emerging field of unmanned aerial vehicles, commonly referred to as UAVs or drones, to inspect areas that would be dangerous and costly for a human inspector. In the two short years since, the idea and technology has grown to include not only bridge inspection, but also data gathering and monitoring of projects. About a year ago, district engineers authorized a Drone Pilot Project that would look into the possibility of using UAVs for design surface gathering, bridge inspection, and construction inspection and documentation. 3. Communication • Branding Innovate ITD! Creating the Innovate ITD! brand has been important to the success of ITD’s innovation efforts. With a distinctive logo and color palette, the Innovate ITD! brand has been incorporated in write-ups, newsletters, videos, emails, press releases, flyers, certifi- cates, award ribbons, and mugs. The branding helps raise awareness about Innovate ITD! • Transporter Newsletter. The Transporter is ITD’s internal digital newsletter, published weekly. This newsletter is used regularly as a vehicle for telling the story about how innovations are being implemented across the state. • YouTube Channel. ITD has a YouTube channel and created video productions of the “Best of the Best” annual awards presentation video (IDT n.d.). 4. Recognition and Reward • Innovate ITD! Ribbons. ITD found that employee recognition is a successful way to engage employees on the importance of innovation. An Innovate ITD! ribbon is given to each employee who submits an idea through the ITD SharePoint site. If an idea is submitted by a team, every individual on the team is recognized. Staff commonly display ribbons around their workspace. • “Best of the Best” Awards. Since 2014, the best innovations in each of seven categories have been recognized at an annual “Best of the Best” awards ceremony, which is also showcased in videos, newsletters, and press releases. Local and state media sometimes pick up stories about top innovations at ITD. Innovations are nominated by ITD innovation stewards and all employees vote on nominated projects. A traveling trophy goes to the winner, with winners’ names added to the trophy each year. • ITD was recognized as one of three finalists for Idaho Innovative Company of the Year by the Idaho Technology Council. ITD was recognized because its innovation results have been impressive, including 405 ideas for improvement that have been implemented statewide. Savings and efficiency improvements amounting to $2 million have stretched money that can be applied to Idaho roads, bridges, and to delivering improved transportation services. ITD employee-initiated and reported innovations have also saved more than 66,000 labor hours of contractor and employee time across the state. Of the reported innovations, nearly 150 are customer service improvements. 5. Measurement • Innovation Scorecards. Some divisions of ITD use an innovation scorecard to set targets each year for how many ideas employees think they can generate and how much money employees can save the organization. Some employees find the scorecard helpful, while others feel the scorecard results in poorer-quality ideas due to a focus on the quantity of ideas.

56 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation • Innovation Team Measures. The Innovation Team maintains a spreadsheet tracking tool that tracks the following measures: – Number of implemented ideas with hours savings, – Annualized hours saved from implemented innovations, – Number of implemented ideas with dollar savings, – Annualized dollars saved from implemented innovations, and – Number of implemented ideas with customer service improvement. 5.5 Private Sector: Kiewit Corporation Kiewit Corporation is a privately held, employee-owned Fortune 500 contractor based in Omaha, Nebraska. Kiewit is one of the largest contractors in the world and provides construction services for the government, transportation, power, water, and other major sectors throughout North America. Chris Dill joined Kiewit Corporation in 2013 as the Chief Technology Officer. Dill is responsible for delivering technology solutions the business, including application devel- opment, infrastructure, and help desk and end user support. Interview Participants • Christopher Dill, Vice President, Kiewit Technology • Jessica Jensen, External Affairs Communication Coordinator 1. Leadership • Innovation Program Expansion. The Innovation Program at Kiewit has roots in the company’s technology division, but is expanding into other operating divisions across the firm. The formal Innovation Program is still growing and evolving and not yet ubiquitous throughout the company. However, it is important to Kiewit’s leadership that innovation breaks out of silos within divisions and becomes a company-wide characteristic. • Innovation Challenges. Kiewit is institutionalizing innovation with regular “challenges.” These are issued on a monthly, quarterly, and annual basis and are fed to employees to resolve. The monthly challenges are usually small, but the annual challenges can take four to six months to complete. • Innovation Program Steering Committee. An Innovation Program Steering Committee guides the Innovation Program and sponsors the innovation challenges posed to employees. The Steering Committee is made up of a handful of leaders, both in technology and outside technology. The innovation sponsor plays an important role in funding innovations and removing barriers to implementation. The Innovation Team provides training to staff and has written much of the training material in house. 2. Empowerment • Employee Training. When Kiewit kicked off the Innovation Program, employees were introduced to Lean concepts and training was held on how to use the innova- tion crowdsource platform, Spigit. The same training is provided to new employees. Employees are not required to take the training, and some divisions have more innovation momentum that others. The Innovation Program focuses on working with the willing. Kiewit is consistently ranked as one of the top companies to work for and one of the world’s most admired companies. It was recommended by survey respondents. The company has instituted an internal collection of technologies and best practices to help meet the demands of innovation. Their innovation programs recognize “the risk of not doing something is worse than the cost of building a business case, then evaluating the concept.”

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 57 • MBA Leadership Development Program. The goals of Kiewit’s MBA Leadership Devel- opment Program is to accelerate extraordinary individuals into leadership positions in which they will significantly influence Kiewit’s financial success as well as its continued market and geographic expansion. This career path rapidly prepares individuals through rotational assignments in business development, pre-construction planning and estimating, construction operations, and business line management. As part of the MBA Leadership Development Program, all participants go through a leadership development challenge, where the group is split into three to four teams that create a business plan. A panel of judges composed of executive business leaders, including the CEO, selects a winner and the winning team gets their idea fully funded. It is common for one or more ideas to be funded for at least a proof of concept. The leadership development challenge is the capstone to the Leadership Development Program graduation. The participating teams work on their innovation concepts for months, while continuing to meet all expectations from regular job duties. • External Coaches. Employees in the MBA Leadership Development Program receive advice from external coaches with expertise in Lean startup strategies. The external coaches mentor the MBA Leadership Development Program annual challenge teams. • Continuing Education. Targeted toward employees with 10–12 years with the company, a training program that lasts several days is offered that includes several different track options. One of the tracks focuses on innovation. The courses are offered several times per year, and about 200–350 employees participate in the innovation track continuing education courses annually. Information covered in the courses include different types of innovation styles and Lean methodology, as well as examples of innovation/innovative efforts and the processes or phases necessary to achieve innovation. 3. Communication • Spigit. Spigit is a web platform that houses the Innovation Program home page. It is a third- party web portal where all employees participating in an innovation challenge can submit ideas. After a submission period ends, employees are given several days to vote for their favor- ite solutions within Spigit. The votes are tallied, and leadership reviews the top 5–10 ideas, for which they then conduct more traditional evaluations to see if the ideas perform well in a model. Ideas selected by the crowd that also perform well when using traditional metrics are discussed by leadership for funding and implementation. • Publications. A weekly newsletter is issued digitally to all employees who have participated in an innovation challenge through Spigit. Kiewit’s most high-profile project innovations are showcased in the newsletter. 4. Recognition and Reward • Reward. Kiewit’s policy is to reciprocate benefits to employees who successfully innovate. A wide range of rewards and recognitions are given, depending on the circumstances. Gift cards and technology prizes are often awarded to innovation challenge winners. Spigit awards points to employees based on how many ideas and how many votes they submit. Employees are competitive about where they are in the innovation rankings, and the top point scorer is recognized at the Annual Technology Summit with a plaque. At the same summit, updates on the returns of prior winners’ innovations are provided. The Com- munications Team also publishes a story about the winner for the internal newsletter. The winning team of the MBA Leadership Development Program’s leadership challenge is awarded a cash bonus.

58 Guide to Creating and Sustaining a Culture of Innovation for Departments of Transportation 5. Measure • Monthly Report. The Innovation Team reports monthly to the Innovation Steering Com- mittee on several measures. Measures include the number of innovations submitted through Spigit, sponsoring implementation and funding for select innovations, and the returns on implemented innovations. Measurement tracking is simple and effective. Microsoft Office products are updated and maintained regularly by the Innovation Team to track the returns (hours or cost savings, reduced environmental impact, etc.) of Kiewit innovations. 5.6 Medium-Sized DOT: Minnesota Department of Transportation The mission of the Minnesota Department of Transportation (MnDOT) is to plan, build, operate, and maintain a safe, accessible, efficient, and reliable multimodal transportation system that connects people to destinations and markets throughout the state, regionally, and around the world. Minnesota has a large multimodal transportation system that includes roads, rail lines, airports, ports, waterways, pipelines, transit systems, trails, paths, and sidewalks. MnDOT’s major divisions include State Aid, Engineering Services, Operations (which fall under the Chief Engineer), Modal Planning & Program Management, Corporate Services (which fall under the Chief Operating Officer), and the Chief Financial Officer. Interview Participants • Mark Nelson, Statewide Planning Program Manager • Brian Kary, Freeway Operations Engineer 1. Leadership • Wildly Important Goals (WIGs). WIGs are the central element to Sean Covey’s The 4 Disciplines of Execution, and this influential management approach has emerged as a key driver of innovation at MnDOT. It provides a simple, repeatable formula for executing on an organization’s most important strategic priorities. The four disciplines include: – Focusing on the wildly important, – Acting on lead measures, – Keeping a compelling scoreboard, and – Creating a cadence of accountability. In 2014, MnDOT launched its WIG 1.0, called “Enhancing Financial Effectiveness,” which was designed to generate major improvements in financial management and included the following sub-elements: budgeting by products and services, efficiencies, asset management, project management, and information and outreach. In 2016, MnDOT’s senior leadership began strategic planning for MnDOT’s WIG 2.0. The WIG 2.0 approach will use lessons learned from WIG 1.0, Enhancing Financial Effectiveness, and will be an agency-wide effort to identify MnDOT’s customers, what those customers value, and how MnDOT can measure and improve. 2. Empowerment • Giving Employees Exposure to External Opportunities. Having MnDOT employees involved in national dialogue settings (such as with AASHTO and TRB There is strong evidence from the literature review that establishing a culture of innovation is a priority at MnDOT. For example, they produced a synthesis paper on the topic in 2010, they established Accelerator as their newsletter on innovation, they maintain an Office of Construction and Innovative Contracting, and they conduct IdeaJam.

Case Studies: Practical Advice from Organizations with Effective Cultures of Innovation 59 committees) or engaged in opportunities beyond their typical duties helps foster creative thinking and expose staff to innovative solutions. • Management Groups. MnDOT staff attends formal discipline-based group meetings as a way to brainstorm new ideas. Groups typically meet on a monthly basis and provide an opportunity to share innovation. • Making It Okay to Take Risks. MnDOT wants its employees to understand that risk and failure are necessary components of innovation. One of the values MnDOT encourages is “Be Bold,” which is described by the statement, “I take risks and accept failure. I will use my failures to identify ways to get better.” • The Research Implementation Program. The Research Implementation Program exists to help employees try new things in an agency test area. One way that MnDOT manages risk is by limiting the scale at which an idea is implemented. 3. Communication • Newsline. MnDOT’s weekly online newspaper is targeted to employees, but is also open to the public. Article topics include innovations, major projects, safety updates, and other relevant topics having an impact on MnDOT employees. • IdeaScale. MnDOT’s Research Services team solicits new ideas for research implementation projects through IdeaScale, which has improved the solicitation process and the quality of the ideas submitted. In the past, the team would send an email, with a form attached, to everyone on their lists. Now, Research Services sends an email with a link to the IdeaScale website, giving participants more context for their ideas. Participants can see what ideas other people are posting, and they can also see the seven research categories in which MnDOT is looking for ideas. Because the research need statements are better quality, the proposals have also improved. In the past they would only get a handful of proposals that totally aligned with research needs. 4. Recognition and Reward • Above and Beyond Awards. MnDOT recognizes employees who exhibit excellence in dedica- tion, innovation, creativity, cooperation, and excellent customer service. • Achievement Awards. MnDOT is committed to recognizing and rewarding the outstanding work of its employees through the issuance of achievement awards and other recognition programs. Teams of employees are often recognized together. To achieve a more consistent approach to employee recognition, the following principles were developed to guide decision making related to employee recognition: – There will always be informal, ongoing recognition and appreciation of outstanding work. – Formal recognition programs beyond achievement awards should also be utilized (e.g., Heroes of MnDOT, Above and Beyond awards, etc.). – Recognition should be meaningful and should respect the preferences of the recipients. – The recognition system communicates management’s belief that employees are the agency’s most valuable asset and that high-performing employees are fundamental to achieving organizational goals and in making MnDOT a workplace of choice. – Rewards are most effective when they are meaningful to the individual and are given as close to the actual activity as possible. – Rewards should not be substituted for a competitive salary plan, longevity pay, or supple- mental compensation. – Recognition should be linked to the agency’s and office’s/district’s mission, goals, and objectives. Recognition decisions must be aligned with MnDOT’s strategic directions. – Recipients receive rewards that range from $50 to $1,600 in value.