Mapping the shift fromOccasional to Relentless Innovation

Overview

In this presentation I examine the current state of innovation – occasional, sporadic, ad-hoc – and describe a desired future state where innovation is a consistent business discipline.

State of Innovation

• Innovation is ad-hoc, sporadic and reactive driven by specific customer needs or environmental threats

• Innovation is mostly incremental, focused on improved capabilities for existing products

• Most organizations lack consistent innovation discipline and fail to understand best practices

• Innovation is considered a function of R&D rather than an enterprise-wide capability

Root Causes

• A focus on efficiency and short term profitability

• Tight resource constraints limit innovation activities

• Easier, safer and faster to create incremental improvements rather than disruptive concepts

• These factors create a vicious cycle of ever decreasing innovation

Current State is not Sustainable

• Five forces that will demand more innovation:– Pace of change is increasing– Access to information/education is increasing

everywhere– Barriers/Cost of entry and development are

decreasing– Type and number of competitors is multiplying– Customer demands and expectations constantly

shifting

Response Options

• There are three possible responses– First, do nothing. Wait to see if these shifts are

sustained. Likely outcome: obsolescence– Second, tinker around the edges. Try a few

innovation initiatives with no real commitment. Likely outcome: frustration and cynicism

– Third, shift to an innovation posture. Develop methods, skills and capabilities. Likely outcome:innovation mastery after seismic shifts

Desired Future State

• For our success, innovation in the future must shift:– From incremental to disruptive– From reactive to proactive– From ad-hoc to a defined methodology– From isolated pockets to enterprise wide– From occasional focus to consistent discipline– From partnering to open innovation

Incremental to Disruptive

• Today, many innovation activities are focused on extending existing platforms or creating small improvements to existing products or services.

• Firms must improve their capability to look further into the future, identify emerging threats and develop radical or disruptive capabilities, platforms and technologies.

• Innovation must encompass both incremental and disruptive innovation.

Reactive to Proactive

• Most innovation work performed is in response to an external threat or a market shift.

• Firms must develop the capability to invent or discover new insights, new technologies and platforms and lead customers to these new concepts.

• Innovation must become a proactive capability rather than simply reactive.

Ad-Hoc to Defined Methodology

• Most firms have well-defined methodologies and work processes for important business capabilities.

• Firms must define and implement an innovation methodology to ensure everyone is working to well-articulated, well-understood methodology for innovation.

• If innovation is important, it must be supported by a well-defined methodology and workflow

Isolated Pockets to Enterprise-Wide

• Every product line or business unit has some innovation expertise, but the knowledge and capabilities are in small pockets and aren’t shared or communicated.

• A firm must view innovation as a consistent capability which enables its strategic goals and missions, and deploy innovation capabilities and knowledge across the entire organization.

• There’s no “one” team responsible for innovation – everyone should be involved and every team constantly innovating.

Occasional Focus to Consistent Discipline

• Occasional innovation based on customer need, serendipitous discovery or environmental threat

• Firms must recognize the importance of a consistent, persistent focus on innovation and the deployment of an innovation “discipline” as a consistent capability.

• Innovation is too difficult, too risky and uncertain to pursue except as a consistent discipline.

Partnering to Open Innovation

• Current focus on innovation in most firms is internal, with some nascent attempts to gather ideas from customers or partners.

• Every firm must embrace the concept of “Open Innovation” and evolve their working relationships, channels and internal capabilities to scout, evaluate and license important technologies and identify valuable partners.

• Soon all innovation will be “open” – we won’t make a distinction

Achievement

• You’ll achieve your goals when:– You identify new technologies, new platforms and

informs customers of their need– You deploy a consistent innovation process and

engages the process repeatedly– Your employees understand the importance of

innovation and have the necessary skills to sustain it– Your culture embraces, engages and sponsors

innovation– Innovation is not a “happy accident” but a daily way

of life for everyone

The work involved

• This is a seismic shift for many organizations, challenging– Leadership styles– Communication– Existing corporate culture– Existing business processes, decision making,

funding mechanisms– Skills and roles

Layering or Grafting won’t work

• Many firms fail when attempting innovation because they try to “layer” innovation on top of existing processes and attitudes. The existing processes ultimately reject innovation.

• Some firms attempt to “graft” innovation to the organizational structure, creating innovation teams while sustaining status quo operations. These innovation teams are quickly isolated and slowly shrivel.

Shift requires commitment

• To complete the shift from an occasional, reactive, ad-hoc innovator to a relentless innovator takes more than a few innovation projects, it requires developing an innovation capability and discipline

• It requires a shift in skills and resources, and a change in tolerances for risk and uncertainty

• It will require different funding mechanisms and different timelines.

Seismic Shifts

• In many regards, there is no choice. The market is shifting and you can shift or become extinct, much like shifts in previous decades– 1980s Business Process Re-engineering– 1990s Enterprise-Wide Systems (ERP)– 2000s Internet-enabled business– 2010s Accelerated, effective innovation

Contact us to learn more

• Email: info@ovoinnovation.com• Web: www.ovoinnovation.com• Blog: Innovate on Purpose• Twitter: @ovoinnovation• Phone (919) 844-5644 x789