The first one is about innovation leadership. This may sound obvious, but in our experience it is the number one reason for success or failure. The leadership should come from the top — at the very least in the form of active top management sponsorship but better in form of active personal involvement, guidance and inspiration for the respective innovation teams. But, leadership, which can come in different shapes and forms, also is supposed to come from all key members of the innovation team.
Not even the most brilliantly articulated innovation idea or plan can compensate the active involvement of a dedicated innovation team. Innovation strategy has to be more than just empty phrases of confession to innovation. It needs high-level commitment of someone who is obsessed with innovation.
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Second, the execution of an innovation strategy needs a home in or outside the organization. Many believe that innovation is better done in a start-up environment, rather than in a corporation. Indeed, there are many reasons why innovation is not easily executed within a corporate environment, but entrepreneurs know that it is not easy in a start-up either.
There are great success stories of corporate innovators e. So, we should not be too simplistic about this.
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Multiple considerations drive the decision about the optimal home. For example, proximity to the core business, availability of critical talent, and cost synergies should all be considered. Corporations should face the reality that innovating in the context of running an important daily business is virtually impossible.
We recommend following two simple rules: The higher the risk of conflict with the current core business, the more separated your innovation should be from the parent organization; and the more your innovation requires access to existing corporate assets, the less separated it should be from the parent organization. Also, corporations should face the reality that innovating in the context of running an important daily business is virtually impossible. But, making innovation happen is a full-time job and mostly even a lifetime obsession.
The third step is about focus and being realistic about how many and which kind of innovation initiatives a company can drive simultaneously. Even though we recommend paying particular attention to big ideas, we know that the success of disruptive innovations is highly uncertain and understand that it is important for companies, especially large organizations, to have a clear picture of predictable outcomes.
No automotive supplier will develop a new product out-of-the-box without already having the demand of an automotive OEM. Overcoming this reality may be the most difficult step an organization must take to successfully execute the innovation strategy. Organizations should differentiate between innovations that are developed for existing products; those sold on existing channels to well-known customers with a highly-predictable payoff; and those disruptive innovations with an uncertain future and yet the potential for massive payoffs.
When Apple developed the first iPhone, they were enthusiastic and obsessed with the idea of how they could transform the mobile phone market, even if they could not predict how successful the product could be. We often see companies with too many projects that are too incremental in nature. Leading innovators run a focused portfolio of innovation projects with a conscious risk-growth potential trade-off decision.
You need to find a way forward and determine how to avoid the Innovation Death Spiral. To do that, companies need to decide which innovation to follow, how to significantly increase their technology success rate and reduce their time to market. One way to achieve that is to open up the innovation process, i. The opportunity cost of closed innovation is low access to brain power, expertise, existing solutions and problem solving capacity. By contrast, a paradigm shift to open innovation, where companies invite external experts to participate in the innovation process, accelerates and de-risks innovation programs and creates innovation at much lower costs and with a higher probability of finding the right solution.
Once the context for execution is set up, the focus should be on building the right team.
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The mix of people required strongly depends on the specifics of the strategy to be executed, but there are a few common requirements — next to the leadership profile already mentioned. The people involved need to find a certain level of excitement and thrill in taking a risk to achieve something big. When one of our clients tried to form a team to go after a substantial technology innovation opportunity in a separate organization the main concern among some of the internal researchers interviewed was, how would the newly created entity pay contributions to their retirement plan.
This shortage not only puts pressure on all companies to get inventive in attracting talent, but also in developing training, mentoring and development programs so they can build their own talent and leaders. Small and mid size companies have an advantage in that they typically can move faster than larger organizations.
5 Key Points to Consider when Developing an Innovation Strategy
Improving business practices, processes and HR will play a key roll in who gets, develops and retains the talent in the future. Another trend appearing more frequently in literature is the shift to more corporate social responsibility The new approach includes profit, people and planet.
The increased focus on social responsibility that benefits the community not only changes how consumers will select their products and services but also changes internal operations, strategy, goals and talent recruitment. This is a new challenge for businesses that may not have considered social responsibility in the past. Addressing the new challenges will require innovative solutions.
The workforce is becoming more social and more mobile 3 , All indications are that this trend will continue. More tools are coming to facilitate learning, communication and collaboration. Younger workers and consumers are not only skilled at using these tools but are expecting them.
The result of all this enhanced social interaction is that the value of relationships is beginning to replace the value of transactions. This is leading to new business models and new worker engagement. Moving forward, work-life balance will evolve into work-life integration 8 , Technology is making it easier for mobile working, telecommuting and flexible schedules. This places pressure on employers to provide tools and change their corporate culture in order to attract and retain the talent they desire.
Also, since the line between work and life is blurring, the threat of employee burnout increases. Companies will have to deal with these pressures to maintain a talented workforce.
In the near future, even corporate culture will be a challenge prime for innovative solutions. To be successful in this increasingly competitive and fast changing business environment, small and mid sized companies will need to outperform others at business strategy, product and service development, talent attraction and retention, flexible and efficient operations, and effective use of technology.
Every organization has its own priorities, goals, and issues to balance.
Managing the Technology-Driven Enterprise
Innovation is quickly becoming a survival skill. Working towards tomorrow today is imperative.
Closing the doors will eventually come to those who neglect to do so. Lerman Stefanie R. You must be logged in to post a comment. Increasing Competition As mentioned before, competition is a typical reason for encouraging innovation in business. Increasing Globalization Not that long ago, competitors were local or national, for the most part. Increasing Consumer Expectations With social media and the continuing advancement of technology, marketing will become increasingly personalized for each customer 3 , Advancing Technology Startups, small and mid size companies are becoming more technologically sophisticated 4.
Changing Workforce Demographics Changing workforce demographics have been on the horizon for some time 9 , Changing How We Work The workforce is becoming more social and more mobile 3 , Conclusion To be successful in this increasingly competitive and fast changing business environment, small and mid sized companies will need to outperform others at business strategy, product and service development, talent attraction and retention, flexible and efficient operations, and effective use of technology.
Before you go. His company is dedicated to a holistic approach to innovation based on real world consulting experience, psychology of the creative process, and current academic research. No dust jacket, as issued. Fine binding and cover. Clean, unmarked pages. Ships daily.
Shipped from US within 10 to 14 business days. Book Description Springer Nature, Germany, Condition: Brand New. Book Condition:- Brand New. Secured Packaging. Fast DeliveryBookseller Inventory Seller Inventory STM Never used! This item is printed on demand. Book Description Condition: New. Seller Inventory n. Language: English. Brand new Book. Capitalism produced entrepreneurs and property rights, the two basic pillars of innovation and growth.
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