The word Innovation looms large in the word cloud of the American business lexicon. It is routinely found in vision statements, motivational posters, corporate lobbies and, more recently, on business cards and LinkedIn profiles.
There is no doubt that many businesses and business leaders have recognized the importance of innovation as an organizational competency. That said, many are still struggling with the actual development of that competency. Leaders want a scalable, repeatable innovation discipline that produces tangible business results, but they are not sure what it should look like – let alone how to make it a reality.
This ambiguity often leads to very conservative forays into Innovation – “cosmetic” efforts that produce little impact. This happens when business leaders convert innovation efforts back into more familiar territories like operational excellence, cost reduction, market expansion, etc. Some examples of innovation “toe-dipping” include:
- Establishing a small team that has “innovation” grafted on top of their existing duties
- Hiring someone to lead innovation efforts who is ultimately under-resourced and does not have the clout to get buy-in from the organization
- Buying ideation software without dedicating the resources necessary to ensure its successful launch, adoption, and repeatability
Many companies, however, have taken a more aggressive approach to creating an innovation competency. Leadership at these companies recognize that the business ecosystems they are familiar with are in flux and will likely stay that way. They know the new normal is a business environment where the relationship between companies and their customers, partners, and competitors is never fixed and always evolving. They are marshalling resources and are purposeful in their intent to make innovation a strategic pillar that drives the company to shape or quickly adapt to an uncertain future.
So, how do you make innovation a strategic pillar? Allocate a significant amount of human and financial resources to developing and maintaining a permanent, rigorous, measurable innovation competency.
At Imaginatik we are fortunate to work with a number of clients that have world-class innovation programs. Many of these companies allocate as much as 10-20% of their overheads to the practice of innovating. Of course, they still focus on their core business and efforts to improve operations while pushing for growth into adjacent businesses. The main differentiator for these companies is in their recognition that future success depends not only on the incremental growth of the core business but also on an opportunity they likely haven’t conceived of yet.
They also know that most great ideas are not lighting strikes. Most industry-changing ideas, in fact, have been formed and reformed – built on over time by diverse, cross-functional teams. Innovative leaders harness the collective intelligence and experience of their employees, partners and customers – a critical function for their company to be the one that eventually cracks the code. But they can only do so if their innovation program is a well-funded, integral part of their business’s overall strategy.