In “Playing to Win - How Strategy Really Works” by AG Lafley and Roger Martin, they sum up strategy as, "making specific choices to win in the marketplace." They say strategy is “an integrated set of choices that uniquely positions the firm in its industry so as to create sustainable advantage and superior value relative to the competition."
We see innovation much the same way. Companies have to make specific, well-informed choices to win in innovation. Successful companies consider how they resource innovation, how they lead innovation and influence their culture, how they engage in external innovation and innovation and how to support the overall program with tools and processes. These are interconnected multi-dimensional choices that company leaders need to explore, decide and execute in alignment with the overall company strategy.
In ”Playing to Win,” these choices start with "What is our winning aspiration?" So let me ask you, what is your winning aspiration with innovation?
• Do you want to create new revenue?
• Do you want to engage employees?
• Do you want to find the next disruptive technology in your industry?
• Do you want to connect with external thought partners?
• Do you want to reduce costs?
Each of these is possible through innovation - the challenge becomes deciding which aspiration to pursue and when to pursue it.
First, leaders should understand the business imperative driving innovation in your organization. Successful leadership teams share the view for the measurable outcomes to be achieved; this helps inform and shape the areas of the business they are innovating.
They make hard choices about where they focus their time and attention:
• Are we focusing on breakthrough / disruptive? Incremental? Are we innovating with external parties? Some combination of all of these?
• Why are each of the chosen focus areas important to our firm?
• What can we expect to gain as a company by deliberately placing our focus here?
Making the right choices in innovation ultimately helps win an organization’s competitive game. For example, having an always-open suggestion system may be good for morale and may be good for perception, but does it help us win? Targeted challenges and focused external innovation may be the right approach instead. The key ingredient to winning at innovation is creating something that is unique and sustainable.
What core capabilities do we need to put into place? Do we need to support our team in developing their creativity? Do we need to organize our teams or re-think our physical locations to better encourage "bump and connect"? Do we need to look at the way we lead innovation in our company? Do we need to better develop our external connections, or lower barriers to making external connections? Do we effectively gather and unlock consumer insights? Do we consistently, effectively take our new ideas into the market place?
What management systems need to be in place? How can we effectively measure what gets through the innovation funnel? Do we have enough people in the innovation process to achieve our outcomes? Do we need employees skilled in facilitating breakthrough processes? How many? What training program will they need? Do we need software to enable the collaborative and decision making process?
Supporting a winning core strategy that generates real results takes careful consideration. It requires thoughtful answers to these questions.