Innovation and today's Pandemia

Why another article on innovation?

I wanted to write this article because, right now, in these times of pandemia, a lot of companies, if not all, are dealing with a unique problem in human history, which is a ferocious war to survive. I really hope that this world-state comes to an end soon but in the meantime let's talk about one tool that can make the difference in business.

Sometime ago, in a chat with some colleagues, I was asked to give my point of view about innovation. In my career I have been involved in several innovation initiatives as consultant or employee, so I had to organize my ideas according to the talk because we were discussing IT Innovation, but, it’s impossible not to include "Innovation" per se.

What is business innovation?

That is the question! Business Innovation is a process to introduce new process, system, methods, product, service, etc. to improve, or solve, a process, system, methods, product, service, etc. all focused to enhance or improve services or products, meaning, at the end, profit for the company, not just money. Worth to say that, all business actors (clients, employees, suppliers, investors, etc.), should be in the center of the equation, be the focus of the business.

IT innovation, per definition, is kind of restricted to optimize the organization & align technology and business goals by using technology in new ways. I consider that IT doesn't have a "real" restriction, I'll explain this in the final paragraph.

But there are no boundaries or final words on innovation, and this is the point that I want to address.

A deeper analysis, creativity

I'll quickly seed some concepts about innovation.

The word that comes out every time in innovation is "new". But, plain and simple, what is new? At the end it comes as the main point of discussion. New to who? or new to what?

On the other hand, when asked about the ROI of the innovation initiatives, some companies or IT areas tend to write down a +1000%, meaning that, by the fact to implement that initiative, it was paid in the first mili-second of its existence.

On the other -other hand-, when asked companies about IT impact, they just don't know because there is no full relation between investment and profit. Or at least IT hasn't done, or doesn't know how to calculate, those numbers for the company.

When we talk about companies, we talk about ethics, trademarks, market share, green business, disruption, service, product, etc. but the final reference is profit, revenue. The most admired companies are the ones that, not talking about internal culture or market niche, make tons of money.

Finally, creativity is the pillar of innovation and it is implied but it is not included in the definition per se. Instead we can find other words that talks about the delivery, like effectiveness, improvement, solving problems, be better, positive change, etc.

So, all the expressed above lead us to the next words (that are good ideas for future articles):

• New. What happens with new things? Rejection reaction.
• ROI. What happens with low ROI projects? Not approved.
• Business profit. What happens with low business profit? Company closed.
• Creativity. What happens with lack of creativity? Old recipes followed, same failures, comfort zone, kick the same stone again and again, blindness, laziness to think, “fail with the big ones”.

Creativity for business is the key that may unleash the power of innovation because, even if the company considers anything new or with high ROI or high profit, as innovation, only with creativity the efforts in the same line will continue. How many times something new is implemented but never continued or simply de-implemented? Not all the times but several times.

What came first, Chicken or Egg? Technologies or Business models?

The egg, of course.

When talking about the so-mentioned disruption models (AirB&B, Netflix, Uber, etc.) we talk about the reinvention of a business model based on technology. But don't forget that due the existence of new technology and frameworks it was possible to create those businesses. Technology goes from infrastructure to software, frameworks from programming tools to regulations... we talk about streaming, standard formats, new battery cel phones, mobile, service cost reduction, cloud, open source, programming methodologies, network layers, programming languages, NaaS, GPS/GPRS, open HW platforms, etc. We talk also of best practices, new business regulations, education-MOOCs, paradigm shifts, culture adoption, trends, fashion, etc. Today I can say that the very last business innovations are Design Thinking and the recognition and creation of the Startup Model, different from the business model, that implies a total different approach. But, let’s continue…

Every piece of technology implied an innovation that made possible a new business model, the egg that gave birth a new business model. Evolution over innovations.

Technology is everywhere, is being democratized, and there is an immense range of options for business, but not everything is for all companies. Nano, Micro, Small, Medium and Big companies can benefit of many options but each type of organization has a different pace to implement solutions simple because they are facing different challenges and have different reach, different context.

Strategy and the innovator

Well, this is a delicate point because implement something new isn’t necessarily an innovation, but people like to think like that and some employees are recognized in that way. I am going to put some business and IT examples…

• The company doesn’t have an ERP, implement it is an innovation?
• Finance can manage taxes differently but current Director doesn’t know how to do it, the CEO will hire an external consultant to do so. Manage taxes better is innovation? Finance is innovating?
• We can use WApp to share documents faster, the supervisor that uses it a lot can help us. Using WApp is an innovation?
• Sales are going down, let’s do ECommerce. Implement ECommerce is innovate?

Strictly talking none of the above are innovations. In the current way-of-doing-business are late decisions. The very first implementations were real innovations. But, to avoid discussions, let's say that are innovations because are new to the company, with high ROI, high profit.

For example, in retail, multichannel is a concept but still has room for innovation because is necessary to think a way to link different areas and processes through systems and tools. The same happens when a system is adapted (new modules) to companies. Other example is implement real AI for marketing or any other area as are very new functions or solutions.

But, all innovative ideas, come out of an analysis, it doesn't come as a stand alone solution, it is a complete company effort because it should provide a solution, not making the business more complex.

Having a company strategy, at least objectives, is the best way to push innovation along with the vision and mission. But, anyway, is neccesary to constantly check the market of new technologies as may impact any current project.

To do so are many actors but there is one that push innovation and is the intrapreneur. Those persons that see beyond the problems and solutions, that see how everything can work and be integrated better and share a vision. One example is the manager that runs the department as if it were an external supplier. This is material for another article but keep in mind that in a company are several intrapreneurs that may not have tools and guidance to build innovation.

What percentage of innovation can a company have?

Well, if a company or an internal department devotes time to innovate means that they have time to do so. Several times I have seen this in motion, but there is an inherent risk when doing innovation and is related to business control.

I am not going to include a 100% innovation company because we talk of an investigation company that lives that way, it has budget to do that and is it core business.

Neither will include companies that really innovate in their field based on the commercialization of their products, meaning that own patents and provide services around it, meaning a 50% to 80% of innovation percentage. The same happens with technology start-ups as the core product is a programmed specific App.

Let’s talk about companies with the necessity to be better, innovate in service. I separate them in two companies, with control and without control.

• Companies with control: all departments are running kind of smoothly, so they can have time to think, to investigate, to organize, to plan. Here the innovation percentage (“new” things) depends on the number of initiatives, budget assigned. Here we see companies having the operation under control while trying new things. The percentage is around 40%, 4 out of 10 initiatives are new stuff. The number of initiatives will keep constant as far as they generate profit or provide control for the business and continue with innovation plans.
• Companies without control: one or more departments are not running well. This is an internal effect that makes all initiatives fail, delay or be abandoned. If one of the areas devotes all the time to control the area then nothing can be done. For example if you need a resource, one person, from the Commercial area for a project you may never have his time because will never attend to your meetings, and, as all the area is in problems, the CCO will never have time for you neither, even when she or he has good intentions. Worst if the areas are Finance, Sales, Operations or IT. Some areas could innovate as a separated effort from other areas.

I have had the fortune to work in both company types. When I was asked to implement new things in an uncontrolled IT I could manage in the beginning less than 10% on innovation and 90% in control.

The period to move from 10-90 to 60-40, depends on IT Direction overall experience (business and IT) and the support from the General Direction, meaning, from my point of view, 3 to 5 months if have both.

Lack of experience of the head will detonate underlaying problems inherent to the business processes and expand the time a lot.

What to do in these times?

Any company can innovate, work in new things, or make old things new. Next my recommendations on this pandemia times with innovation tips:

• "Think out of the box” also means go outside and compare, do benchmarking. Doing so, one company can generate multiple ideas to solve their problems, new solutions. Not necessarily find the final solution but obtain first ideas. Just keep in mind that strategy is the base to create an integrated project.
• Dare to try new things and give a chance for something that did't work before. Quickly. But don't seek failing as success.
• Look for the intrapreneurs and set a working plan with them. Especially in the areas of Commercial, Sales and Marketing. Boost creativity.
• If possible, hire people with experience in crisis and hire innovators. Remember that you will usally find that innovators are grounded-dreamers and crisis experienced are energetic-soldiers.
• Urgently gather clients and suppliers point of view about their problems and see if you can cover any new necessity.
• Constantly monitor the spirit in your company, you have to cheer them up!

Retaking what I said in the beginning, IT is not really restricted in innovation because there are many “new” technologies that the company could use. The risk, as I have seen, is blotting IT, but that depends again of the strategy, IT experience and budget.

• Try new free technology with your IT area. Today you can find a lot of technology ready-to-go as CRMs, Web pages with SEO, Social media (free video editors, free music), HRMS, ERPs, etc. The single cost is the implementation expense (very low), the cloud expense (low) or really free (if you have a server or in your computer).
• Use mobile remote tools (Skype, WApp, Zoom, etc.) with your teams, your clients and your suppliers.
• Benefit the areas that puts money in, sales & marketing, also manufacturing, quality & operations if is in your core, and make efficient the backoffice. Simple, right?

Final words

Hope this helps. Innovation is a very rich field and there are a lot to do and experiment, a lot to try and to be succesfull. Today many companies are under a very critic situation, facing closure, not for the lack of business but for govern restrictions. Any comment let me know, I'll be glad to help.