The High Cost of Paying Lip Service To Strategic Innovation

“We’re a very innovative company!”

“We pride ourselves in being a value-added provider to our customers!”

I have yet to come across a company that doesn’t say this. However, the real proof is in the action: “What structure, systems, and processes do you have in place to intentionally innovate?”

Without an intentional process in place to innovate all that can happen are random acts of innovation. We hope that the founder/visionary gets a good idea. We hope that the good ideas actually get implemented. But as we all know, Hope Is Not a Strategy !

We need to be DOERS of innovation not just SAYING we are innovative.

(This reminds me of what Jesus’ brother, James said, “But prove yourselves doers of the word, and not merely hearers who delude themselves.” James 1:22, NASB )

When we neglect Strategic Innovation in our organizations the following things also get neglected:

Limits Growth Trajectory

Strategic Innovation offers the potential to accelerate growth. Companies that fail to intentionally innovate will never realize their true growth potential.

Leaves Revenue and Profit on the Table

Companies that fail to innovate leave revenue and profit on the table. Revenue from new products, services, go-to-market strategies, and customer experience ideas never gets realized. Profit from ideas to streamline delivery and reduce expenses never gets to the bottom line.

Minimizes Company Valuation

Lower growth trajectory, lower revenue, and lower profit all lead to minimized valuation. This is tragic for business owners who truly want to make an impact.

Some focused, intentional effort in the area of strategic innovation could literally yield millions if not tens of millions in company valuation at an exit. Failure to strategically innovate unnecessarily limits legacy, lowering the ability to transfer generational wealth and the resources to give to critical causes.

Hurts Competitive Advantage

Nothing in this universe is static. You are either growing or shrinking. You are either increasing or decreasing. Competitive advantage is like this.

• One hundred years ago, Sears and Roebuck created a competitive advantage by innovating mail-order catalogs that allowed people to access a large variety of items from the comfort of their living room.
• In the 1960’s Sam Walton created a competitive advantage by innovating a streamlined distribution strategy that gave small-town buyers easy access to a large variety of items at the lowest prices.
• In the 2000s, Jeff Bezos created a competitive advantage by innovating an e-commerce platform with technology and logistics to allow buyers to get anything from “A to Z” delivered the next day. (And now within hours.)

Competitive advantage is not static. Sears failed to innovate and they are almost nonexistent. Walmart got on the e-commerce bus a little late and is working hard to catch up to Amazon. If Amazon stops innovating, someone will develop a competitive advantage over them. This is true for every business.

Opens the Door to Innovative Competitors

No company would intentionally leave the back door to their offices open overnight. Anyone who did this would expect to be robbed. Yet, how much responsibility do you bear when a savvy competitor steals one of our customers?

Yes, you must provide excellent customer service. That’s table stakes. The real thing that creates stickiness is providing ever-increasing opportunities for value. A company that does not provide increasing value through customer-focused innovation is leaving the back door open to competitors.

To be good stewards of the companies we are called to lead we need to have an intentional plan to innovate.

Reduces Employee Engagement

Every organization has innovative employees who have the Working Geniuses of Wonder and Invention. All day (and sometimes all night) long they are full of ideas to improve the company. However, without a structure and process for Strategic Innovation, the chances of these people getting the fulfillment of seeing their ideas come to life is slim. Sadly, not only do many great ideas never see the light of day, but many of these people get frustrated and leave in search of a company that values innovation.

Conclusion: It’s Time To Get Intentional About Strategic Innovation

If you have made it this far in the article, hopefully you are seeing the urgent need to prioritize Strategic Innovation in your business. We need to be DOERS of innovation. We don’t need talk, we need ACTION!

How can you take action to strategically innovate? I have some ideas. Click here to set a meeting with me to explore how your company could develop a Strategic Innovation Engine .