The Four Must-Haves for Successful Innovation
Insights - 02.02.2021
Leading innovative companies focus on four fundaments for successful innovation: leadership, culture, strategy & people. Together, they allow companies to go from idea generation to value creation with a product or service.
What is innovation?
Ask a handful of people what innovation is and there's a good chance that you'll get varying answers or an inspiring quote from Steve Jobs or Elon Musk. But successful innovation is about a lot more than bold ideas. It’s about transforming those bold ideas into added value, leading to revenue growth or increased operational efficiency. This value can be created by introducing new products, services, operational processes and business models. The ultimate goal is to safeguard the competitiveness and long-term survival of the organization.
Delusion of the day
Yet, while successful innovation is so crucial to survival, most businesses fail to nurture their innovation. There is a simple reason for this: day-to-day operations. Answering daily client demands and sustaining excellence in operations demands time and resources. The so called performance engine of a company is geared towards performing and finetuning routine tasks and following predictable business processes. But they also bring in the cash right now.
So, especially in tough economic times, companies tend to focus on this performance engine at the expense of innovation. This is where ambidextrous organizations really make the difference, balancing time day-to-day operations co-exist with long-term, uncertain innovation endeavours.
The 4 must-haves of successful innovation
In a 2020 benchmark study by Innovation Leader and KMPG it is striking that the participating innovation role model companies (including Google, Intel, ESPN, Ford, and Nasdaq) clearly rely on four catalysts for successful innovation.
These findings match very well with our own research. Let’s review the four cornerstones of innovation.
Support from leadership
The more transformational your innovation strategy is, the further your company will be stepping into uncertain territory. This of course requires a different leadership mindset than for day-to-day operations optimization.
If your leadership doesn’t support your innovation projects, success not likely be successfully implemented. No matter how hard your innovation team tries to succeed. The belief in innovation must trickle down from top management into the whole organization, making it concrete and alive.
Due to the longer term horizon of innovation projects, they need strong leadership that can cope with the sometimes difficult situations between concept generation and project completion.
While innovative building blocks can be found everywhere in the organization, it is strong leadership that will fully integrate innovation into the core of your business.
Strategy and vision
Many organizations go about innovation in an unstructured way, hoping they’re doing the right things. The first step of any innovation strategy should be to establish clear objectives. Which direction will we take and what do we expect from our innovation efforts?
Without a clear strategic vision, your innovation efforts will never reach their full potential. Lacking a strategy, innovation often has to rely on internal best practices. A strategy helps to guide the decision-making process. Clear values and vision will ensure that all stakeholders are aligned and working together towards the same goal.
The innovation strategy defines a framework that gives direction to keep your organization on track towards your long term objectives. It can be high-level, but needs to offer clear values that innovation must meet.
Over the years a lot of innovation research went into technological innovation, new product development, service optimization, design thinking and open innovation. Unfortunately, people and teams are not as easy to optimize as a production process.
Though often somewhat overlooked in favour of systems or software, people are the cornerstone of innovation. “No organization ever created innovation, people innovate, not companies” states Seth Godin and we couldn’t agree more!
Individuals all have their strengths, weaknesses, and preferences. You have to find people with the right competences, attitude and behaviour, within your company or externally, to be able to combine them in an optimal way.
Innovation teams need ideators, champions, and implementers to build dedicated or ad-hoc innovation dream teams that bring creative ideas to the market faster and more efficiently.
With the right people in balanced innovation teams, you are armed to differentiate yourself and become the leader of your market with new products, services, processes, and business models.
It is exactly here that the INNDUCE.me assessment will help organizations to identify and combine the strongest innovation profiles.
For role models in the field of innovation, an innovation culture is usually already well established. It is like a second nature in the day-to-day operations. Innovation culture is hard to define in a precise way. It is a climate that promotes creativity and implementation. A climate where employees dare to seize opportunities and failure is expected as a chance to learn and grow.
Having a solid culture of innovation increases the chances that new ideas and innovative services can sprout and develop. Fail fast and learn. New and perhaps radical concepts get a real chance instead of disappearing on the chopping block of practical feasibility concerns or slowly dying while waiting for the required signatures from top level executives.
Successful innovation needs strong fundaments. All four pillars must be present to be able to go from idea generation over development to value creation with the finished product or service.
You can put the most creative person on a project, but if there are no resources or no backing from leadership, innovation will be a slow process with a lot of obstacles. You can have the most impressive innovation strategy, but if the culture is unsupportive, or you cannot put the right people on it, you will fare no better.