It is sadly the case that whilst Innovation*1 is often recognised as important in the ‘C-Suite’ or Boardroom, there is typically a massive gap between Innovation rhetoric and action. Most senior managers recognise the role that Innovation can play in developing their organisations; they know that Innovation is often essential to creating or maintaining future revenues and value, but they can become paralysed by past failures or an over focus on process efficiency and/or just a lack of leadership consensus on how best to manage it.
*1 EFQM Definition of Innovation: ‘The practical translation of new ideas into products, services, processes, systems or social interactions’.
Successful innovators find ways to manage the delicate balance of investing in the future, whilst sustaining the benefits being obtained from their current core offerings. -They forecast how much Innovation they need and what specifically it should achieve for them, but the big question is how best to do this? Regrettably, most academic work on Innovation does little to help with such aims; valid research is fragmented and where systemic views exist they are rooted in the micro-perspective of a specific discipline, and little cross-faculty, cross-discipline work is done to consider the broader subject from the perspective of the holistic organisation-wide management systems, within which most business managers have to operate.
The Innovation Reboot Project™ is a collaborative learning experiment, aimed at both academia and organisational managers, with the objective of promoting Innovation Capability Assessment Frameworks that may help to encourage the open, sharing of knowledge on what best enables Innovation Capability building in organisations.
The logic of the current Innovation Capability Assessment Framework, shown on the left is that at the highest level, a wise Innovator will ensure that a focussed ‘Innovation Strategy’ (Element 1) will be informed by sound ‘Data and Analytics’ (Element 2), which will lead to a portfolio of projects in an ideas launch platform going from ‘Ideation’ (Element 3) to ‘Validation’ (Element 4) and ‘Scaling’ (Element 5), all of which is underpinned by ‘Future Focussed Leadership’ behaviours (Element 7), which act to maintain an appropriate, supportive, ‘Innovation Ready Culture’ (Element 6).
Clarity on an Innovation Strategy is a key feature of those who successfully embed Innovation in their organisational DNA. This is why Innovation Strategy features prominently in the framework above. You could ask yourself the following questions to reflect on the degree of clarity with Innovation that is in your strategies and plans:
Wise innovators define opportunity and initiate ‘projects’ in a range of strategic innovation categories, for example:
An often quoted example of successful growth is Nike, who has transformed with a range of both adjacent and transformational Innovations, from its origin as a shoe company, into one where its future growth is now from digital technology (with phone apps, wearable devices, data and web services now a major part of its turnover). However not every one can replicate such success and there is an old saying that ‘whilst an early bird may get the worm, it’s the second mouse that gets the cheese’ and this applies to many Innovation successes. Apple was not the first to sell mp3 players, when they first launched the iPod; it was to them, at that time, an adjacent market. They had the capabilities to respond quickly, they built a clever new ecosystem around their new product (iTunes), and they laid the foundations for what many respect as some of the most impressive growth attained in the last two decades, through a mixture of exploiting adjacencies for their technologies and simultaneously creating a transformational growth ecosystem in iTunes.
The amount of investment (*2) typically made in a specific category will vary dramatically, according to an organisations strategic need, but it is not uncommon for a mature high-performing company to use the often called “golden ratio” of innovation investments, in which 70% of available resources are allocated to Value Sustaining investments, 20% to Adjacencies and 10% to Transformational Growth, but such figures will vary significantly if rapid growth is being sought, catch-up is needed, or technologies are changing at speed.
*2 Nagji, B. and Tuff,G., May 2012, ‘Managing Your Innovation Portfolio’, Boston, Harvard Business Review. Reprint R1205C.
Maybe this brief article has helped you reflect on how well you are embedding Innovation into your organisations DNA. If you’d like to contribute to an ongoing debate and help us build a growing body of knowledge, to assist with Innovation Capability Building, please engage with our project via http://www.innovationreboot.org and/or our ‘Innovation Reboot’ Group on LinkedIn.
Chris Hakes, maybe known to some of you through his work in the EFQM Training Faculty and supporting the Awards process over many years. He has recently gone back to his entrepreneurial and research, career roots and taken on a new job as Editor in a collaborative venture called 'The Innovation Reboot™ Project'. In the article above he shares some thoughts on the need for, and benefits of, this collaborative project, which is aimed at sharing good practices that may help organisations build innovation capability.