How to Move the Needle with Innovation

The company is staring at the results from its innovation effort, but nothing has seemed to move the needle.?Actually, it seems that the needle is stuck.?The optimists credit that we have learnt a lot and have upskilled a large number of employees in the art of Design Thinking and Lean Innovation. ?The pessimist surmises that we have wasted money with very little benefit, whilst the rest look at this with a level of disbelief and anxiousness.?The company has to innovate to survive, but where to from here?

It is well appreciated that many established companies struggle with innovation because of entrenched cultural and structural barriers; so to say being trapped in the past . ?In times of crises, like 2020, the fight or flight mentality has accentuated the barriers of fear of failure and consequently these apprehensions are more heightened than normal.?People stick to the comfort zones of their day jobs; maintain the status quo of command and control hierarchy; try to balance the challenges of navigating a difficult business environment; whilst being expected to produce the financial outcomes which sustain the business.?These realities stifle innovation.

However, there are others that look at the realities around them and decide to respond differently. ?They use innovation as a vehicle to not let a good crisis go to waste, but drive innovation along one of the following lines:

·??????Incremental – Focus on the existing business, reinventing the core business to operate in this challenging environment, while focusing on existing markets and existing products and services.?This is where your current customer base is, and the business needs to protect it.?This plays out as constant exploration of unmet customer needs, and how to create value in this space.

·??????Adjacent - This innovation focus introduces new offerings to the organisation and it's customer base, but is not new to the industry.?Who knew that clothing manufacturers could have a roaring product line in facemasks? ?The reality is that if existing markets flatten or slow down, and you have nowhere to go, organisations must figure out how to find new opportunities beyond their existing business focus, which reignites excitement in their core business. ?One way to do this is to create new value propositions within your organisation that can add value in terms of a wider offering to your existing customer or create competitive differentiators to existing products and services.

·??????Disruptive - This is about creating new markets for new products and new businesses. ?Many a company found new markets selling personal and protective equipment, from travel agencies to computer hardware stores.?This might mean working outside your organisation to come up with new thinking that has different assumptions rather than tweaking your current rationale. ?This should not only be considered a defensive strategy in terms of a threat, but rather viewed and an offensive play. ?It’s about creating new businesses that actually move the needle. ?Especially in tough times, innovation matters. ?Just remember: It’s not about novelty. ?It’s about creating new businesses that actually move the needle. It’s about growth.

This all looks fine and dandy, but what are some of the considerations that one can take to get the needle moving with innovation??Here are five handy tips to take into account:

1.?????Reconsider the business model – as the world tilts towards digital, many organisations are contemplating utilising platform businesses to help them participate in a virtual world. This involves tapping into co-creating opportunities with third parties, leveraging common industry platform capabilities to build your businesses’ abilities, and exchanging value as part of an ecosystem of participants to the customer, which can all bring the opportunity to grow your business beyond the current physical constraints.?

2.?????Industry collisions - Brainstorm ideas tapping into different industries to create mutually beneficial initiatives.?You are not the only company trying to grow out there.?Partner with a few that are not in your industry and explore how to solve common problems.?This is how to cultivate the opportunity for industries to collide, collaborate and co-create new possibilities.

3.?????Practise and reward failure – Create a space where people can fail and learn, but tie it to initiatives that are focused on the customer needs, as opposed to company opinion and/or commercial gain

4.?????Get closer to the customer – Data collection efforts, trolling through the organisations knowledge of the customer, driving customer surveys and placing yourself in the customers’ shoes is just not enough to get into the thick of it.?Talk to your customer, get them to explain their pains and frustrations and co-create the solution to their problems.?Through this effort you can establish how desirable the solution would be for the customer.

5.?????Create an investor mindset - When an initiative gets to the funding phase, organisations should treat it as a funding/investing opportunity rather than a cost that the company needs to absorb.?Here, the organisation might consider the Venture capitalist approach to fund the initiative.?Drive the focus to create value.

6.?????Create a burning platform to frame criticality and priority - A burning platform can be used as a proxy for a crisis, to frame risk differently, prioritise and link to key company measure points - some being a matter of survival.?This way the organisation can provide focus on key problem solving and opportunity creation.?The teams that are in involved can then be dedicated to this by removing them from their day jobs and should involve a short-term concerted effort (sprints).?This would sustain energy and enthusiasm.?The burning platform focus also allows for more experimentation and risk tolerance as leaders are desperate for these initiatives to succeed.

It is safe to assume that the changes we have experienced this year probably herald some of the new normal that all businesses will have to deal with.?The approach that organisations take to equip themselves is critical to navigate this challenging environment, where the ability to innovate is essential in building a competitive edge.

Authored by:

Bruce Adrain – Corporate Innovation Pioneer

Oscar Stark - Venture architect, digital transformer and founder