Many companies are aware of or intuit the importance of innovation for their business and wish to promote this discipline inside their organisation but don’t seem to work out how exactly to go about it. There is something “intangible” about innovation which makes it difficult to order it and activate it. What’s more, pressing day to day considerations end up taking priority over medium term projects. Innovation tends to be one of those initiatives that is classified along with other projects that are relegated as “important but not urgent” so it is hard to find the time needed to address it. And finally, innovating requires a mix of apparently contradictory aptitudes and it calls for an incredible amount of vision and perseverance, which may overwhelm many people.
After various years providing consultancy on innovation management to CEOs and Management Teams in different companies, the three of us, Xavier Ferràs, Xavier Lesauvage and Joan Vinyets have decided to pool some of the keys to promoting effective innovation inside the company.
Below we outline some of the learnings which we have found have helped many companies to give an important boost to their innovation, accomplish positive outcomes through it and positively con
tribute to business growth and deliver profits. We call these the “12 initiatives for boosting your company’s innovation outcomes”. We present them in the form of a practical guide that all companies can implement in an orderly way.
1.- First, increase awareness. Creating awareness first is a matter of “life or death”. Innovation is initially associated with risk and stepping outside your “comfort zone” and this can “form antibodies”. It is important to get across the fact that without innovation there is no future; that almost any business reaches maturity and decline and needs to transform itself. The majority of companies that “become complacent” end up suffering the consequences. Remember Kodak. What’s more, today the threats do not only come from our competitors but from the disruption that can be created by a startup that has everything to win and nothing to lose. Innovation is necessary in order to survive and grow. It is inherent in the life of a business. As simple and as complicated as that. Be “proactively intransigent” with your teams and find ways to openly demonstrate how necessary it is to innovate in order to create value, pay expenses and grow.
2.- Clear-sighted and courageous leadership. It is always the CEO and the Management Board’s job to provide the initial leadership for innovation. Innovation is a strategic path which requires firm conviction on the part of the CEO and the Management team. It will rarely blossom successfully if we expect it to be led by the team. Teams come up with good ideas and initiatives but they need to be led appropriately. Once the Management Team is sure about the path it must seek to bring on board those employees who are naturally more innovative. As the head of the company make sure that you have a clear vision in this respect, “get your vision across” consistently, support “the innovators”, provide the necessary resources and devote your time and effort to backing and offering strategic guidance to the teams that are developing the innovation. Indicating that it is necessary to innovate will not suffice in itself. Lead by example and you will be followed.
3.- Build an innovation culture. The culture is the substrate of innovation. It is widely known that “culture eats strategy for breakfast” so the best thing to do is to promote a culture that fosters innovation throughout the organisation across the board. It’s not just a question of inviting your employees to drop their suggestions and ideas into a “mail box” but has to do with creating a spirit that favours trying things out and learning, knowing how to collaborate constructively in the face of a great deal of uncertainty, and giving due recognition to people and innovative initiatives… Together with HR draw up measures that dynamise innovation throughout the organisation, that are intended to “lay the roots” for innovation initiatives, to support innovative individuals and reward innovation efforts. Activate initiatives geared to promoting an innovation and lean culture which is agile and flexible, interdisciplinary, communicative and horizontal, whilst giving more priority to the contribution of knowledge than to job posts and departments. Identify mechanisms for turning innovation into a recurring discipline for your business and for encouraging your teams to come up with new initiatives.
4.- Set down clear opportunities. A good strategy defines innovation opportunities. It seems obvious that innovation must be aligned with the corporate strategy and that it should even issue from it. Furthermore, it seems clear that classic Strategic Planning is now dead and that the role of a good Strategic Plan is to identify new opportunities to build the business where innovation is very likely to play a role, be it in order to grow or to transform the business. Draw up a clear and simple strategy that defines a framework of opportunities which your teams can work with in order to build future projects. It is crucial to start off with a good framework that clarifies “where to look and search”. It is something like the difference between having a good briefing and not having one. Defining clear opportunities doesn’t “kill innovation”. On the contrary, it helps your teams to be creatively effective and avoids frustrations. Focus on the final purpose of the innovation and your whole organisation will stand to gain in agility and effectiveness.
5.- Combine Method + Inspiration. You need method: “Inspiration comes while you are working”. There is no innovation without process, methodology and metrics. Innovation seems to be an art where creativity rules but this is not exactly the way things are. It is a management discipline which also requires creativity. Work out how you can establish a management framework for innovation that is rigorous and flexible at the same time. Differentiate “day to day management” from “trial and error” but set up management mechanisms that will enable you to understand the impact of the decisions that are taken. Choose methodologies that fit in with your organisation, train your team to use innovation tools and draw up metrics that will help you to understand the progress being made. Work openly and collaboratively and incorporate a series of tools from the management world, Design Thinking and creative thinking.
6.- Obtain lots of different ideas. Innovation is probabilistic and requires a lot of ideas, from many areas. One idea alone does not guarantee satisfactory results. A few ideas probably won’t either. A great many ideas are needed and that’s why organisations must find ways to constantly come up with a wide range of them. Lots of ideas conceived for a specific field, which are relevant and focused on a clear purpose of contributing value. You must clearly delimit which Opportunities and challenges you want to build ideas around. “Creativity loves restrain” is what they say at Google, and they’re right. We call this “creative tension”. Be systematic and constant in generating ideas. Seek out different sources of inspiration inside and outside the organisation and apply different creativity methodologies, and always look beyond your current product. If we don’t try and see things in a different way it will be difficult to come up with something different. Open yourself up to Open Innovation and in a structured fashion combine concepts from inside with external initiatives.
7.- Improve and then, Disrupt. Start off by “improving” in order to be able to “disrupt a category” later on. Innovation begins with understanding what improvements your business requires. Improvement innovation also known as incremental innovation is not the most glamorous nor is it fashionable in a world that constantly talks of transformation, but well focused, it is effective, solves problems that everyone understands, can come up with solutions that can be quickly implemented (also known as “quick-wins“) and brings in quicker returns. Start off with small things first. Build up confidence and address new challenges. An organisation can only address disruptive projects if it has an innovation culture, a spirit of entrepreneurship, “muscle and an innovation belt” and an ongoing tradition of innovation. And remember that the most disruptive innovation springs from understanding how to leverage yourself in the organisation’s competencies to articulate new knowledge and a new line of business in a different environment. To begin with, identify 2 or 3 incremental innovation projects in your organisation and give them focus and priority. Later on, learn how to build more ambitious projects, leveraging yourself on your competencies.
8.- Know what needs you are addressing. All innovations must always address a clear need of a customer, who is willing to pay for it. It is crucial to implement customer, user, prescriber or consumer understanding programmes. We recommend you introduce a systematic programme that identifies needs and insights. Understanding the customer entails adopting new “more empathetic” research methodologies that help to bring needs and motivations to the surface and identify our “customers’ brakes”… and those of “non customers”. Find out what they really do, feel, and want so as to be in a position to contribute new and effective solutions. This involves getting the entire organisation to adopt an attitude that is more centred on understanding the customer. Demand that your teams really adopt a more Customer Centric approach, that they understand the customer and base all their projects on a value proposition that is relevant and significant for users.
9.- Try things out, learn and scale up. The innovation must be “lean” and scaled up later on when there are “signs” of business. Today “Lean Startups” are all the rage. Having said this, 3M, one of the world’s most innovative companies, has been applying its “try and scale” principle for years. Innovation calls for a “trial and error, starting off small” mentality and you need to set up teams and monitoring systems that facilitate trying things out and learning in a controlled fashion, and then scale up when it makes sense to do so. Provide space, support and a certain amount of resources to the teams but only take the decision to scale up once you have clear signs that it is going to be well received by potential customers. It is very important here to establish agile interaction with potential users of the solution in order to constantly incorporate their feedback and minimise risk. Adopt a Design Thinking approach. Don’t wait until you have the perfect prototype; concepts and use scenarios can be tested out as you go along.
10.- Screen ideas early on. Companies that innovate best, screen their ideas very early on and focus on just a few projects. More rigorous selection during the concept phase will ensure greater focus for the organisation, more resources per project, more expedience and larger returns. All organisations have limited resources and must provide the necessary focus to ensure the success of their projects. It’s better to maintain a focus and give up when you are not going in the right direction than to want to make headway with many different projects in order to reduce risk. Draw up project selection and classification matrixes based on key lines of action and requirements in accordance with the company strategy. Remember that a good matrix enables you to manage innovation initiatives with a short, medium and long term opportunity horizon, like IBM does, for example. Get your teams to take up only a few projects during the early development phase and you will see that the company’s innovation efforts will be reinforced.
11.- Order 2 worlds. Separate the “Core” and “Innovation” and create feedback between the two. When the number of projects grows, things become more complex and resources are scarce, you need to separate the day to day operations of your Core business (the company’s main business where the important thing is to minimise risk, maximise efficacy and efficiency) from the Innovation area, where the focus must be on exploring. The ideal is to apply the “Loop model” whereby the “Core” feeds resources and challenges into Innovation, and the latter feeds knowledge and business opportunities back into the “Core” business. Side by side but not jumbled up. Two different ways of organising but linked together. Find the way to define two areas with different functionings and very good coordination. Set up teams and clear roles along with initiatives and spaces that facilitate and promote collaboration. Remember that you can also supplement your teams with outside talent and expertise, by calling in external experts and the necessary technical knowhow at each phase and in this avoid bottlenecks and having to repeat tasks.
12.- Manage the path. Have a vision and show perseverance, distance yourself from emotions and base yourself on a portfolio of structured projects. You are probably already familiar with the Innovation Funnel Process but you may not have heard of the “Innovation Emotional Barometer” which is about managing emotions throughout the Innovation Process. All projects go through phases of scepticism, emotion, euphoria… the first setbacks, high costs, long payment periods, doubts, disappointments, frustration, “this isn’t working”, anger, depression, “we have hit rock bottom” … hard work, hope, expectations, faith, bounce back or die, signs…new solutions, real prospects, “light at the end of the tunnel”, the first successes, confirmation that “things are going well”, patience and finally…success. This happens in many life projects (studying, practising sports, becoming an owner, building a family, educating, recovering from an illness…living…). You can be sure that this is how it’s going to be and it is up to you to deal with it. There is no alternative. Your role is to know how to manage it well. So, having a good portfolio of structured projects with different levels of risk and maturity as well as clear selection criteria will help you to manage these situations and will ensure that the company’s innovation initiatives are effective. Finally, remember that non-formal and sincere communication at all times and with all the team is key to deactivating any resistance or mental blocks. We don’t want heroes but people motivated by the same challenge to innovate in order to create value.
For the last 20 years we have been living with and accompanying innovation in different sectors, countries and environments and these are some of our key learnings that can be applied across the board in any organisation to effectively boost innovation outcomes.
We intend to provide you with inspiration and insights so that your organisation can put them into practice. If you want to expand on any of these points we will be more than happy to provide you with more details.
If you are interested you can download this set of guidelines or decalogue here in PDF format.
About the authors:
Xavier Ferrás is a Doctor in Economics and Business Studies, a Professor in ESADE and Dean of the Business Studies Faculty of Universidad de Vic. He is a prominent lecturer on Strategy and Innovation and publishes regular posts on his blog on strategy, technology and innovation. @xavierferras
Xavier Lesauvage is a consultant and expert in Innovation and Marketing, an ESADE associate professor and lecturer on various national and international programmes. He has worked for over 20 years as a manager and expert in strategy in the FMCG and Healthcare sectors. He is currently involved in various entrepreneurship initiatives. @xavierlesauvage
Joan Vinyets is an expert in People-Centered Innovation and a close collaborator with the Connociam Talent Network, where he takes part in numerous Innovation Customer Centricity projects. He regularly publishes posts on his blog, where you can find this article along with other articles on Innovation. @joanvinyets