What's Your Innovation Strategy



A Corporate Startup Studio

So you want to turn your business into an innovation machine.

You’re not alone. According to McKinsey, more than 80% of executives agree that innovation is critical to business success, but most are also dissatisfied with the results of their innovation efforts. Sound familiar?

Innovation fails in organizations for a lot of reasons including structure, culture, and allocation of resources. However, there’s one big thing established businesses often miss when trying to infuse innovation into their operations: There’s no cohesive innovation strategy. 

It’s easy to be excited and encourage employees to bring their ideas to the table; however, without a strategy to guide the reshaping of the company to create a fertile ecosystem for innovation to thrive, the ideas get stuck in many bureaucratic processes. 

Why You Need an Innovation Strategy

The antidote to the corporate inertia for policy and processes is to establish an innovation strategy. Your innovation strategy is the glue that holds your organization together, giving you an agreement about what, how, and why you want to achieve a specific goal. Good strategy unifies diverse groups within your company with clear objectives, priorities, and focus. It provides the necessary structure to support innovation and enable execution. 

Good strategy unifies diverse groups within your company with clear objectives, priorities, and focus.

For established businesses, especially, successful innovation often means implementing cultural and organizational changes. But how will you know what changes to make without a documented strategy to define the focus? Starting with an innovation strategy helps avoid the pitfalls of conflicting priorities that might turn your innovation efforts into an unfocused scattershot of ideas, and a self-defeating theater that undermines innovation altogether.

If you want to create a successful and sustainable innovation program, you have to start with a strategy. Here are some things to consider:  

Why is innovation important? 

If you’re serious about creating an environment where innovation can thrive, you have to start by asking yourself why you want to innovate in the first place. What is the purpose of your innovation programs? What are you hoping innovation will help you achieve?

Being able to clearly articulate the “why” enables you to unify your company behind a single purpose. This clarity of purpose will also pave the way for the necessary shifts that need to happen to create a culture of innovation

Image credit: andresr

What Problems Are You Solving For?

One of the biggest reasons innovation labs fail is because they’re disconnected from the market. It does no good to spend millions of dollars engineering solutions, only to discover what you’ve built doesn’t address a real problem. You need to understand what the market needs and devise a process for testing ideas. 

If you want to compete in tomorrow’s market, you want to think beyond incremental innovations. What big industry challenges do you see on the horizon? How will those challenges impact your business? Where are newer, less established startups already disrupting your space, and what can you create that will enable you to maintain or expand your competitive edge?

How Will You Impact the Market?

Most organizations engage in at least a little bit of innovation. For most established businesses, innovation usually is contained within the organization in the form of research and development or new product development. This is a closed innovation model that gives corporations the most control but cannot result in any sustainable or disruptive innovation. Instead, it reinforces the status quo and stifles the development of anything new, different, or potentially risky.

Open innovation, on the other hand, expands the process of innovation outside the company walls and pulls together ideas, technologies, and processes from a wide variety of sources. This kind of innovation creates a rich ecosystem from which to draw on and increases the business’s innovative potential.

Granted, very few companies still engage in strictly closed innovation anymore. However, most established organizations take similar approaches with R&D, M&A, and improving on old products or processes — which simply isn’t enough to create a significant competitive advantage or transformative impact on the market.

Open innovation creates a more fertile environment for repeatable success. What’s more, it’s an approach that gives established businesses the opportunity to lead the disruption in their industries, rather than waiting to be disrupted by newer scrappy startup competitors. 

How Will Your Organization Support Innovation?

One of the biggest roadblocks to successful corporate innovation is the company culture. If you want to turn your organization into an innovation machine, consider what structural and cultural changes you need to implement to support success. 

From top to bottom, leadership needs to voice support and explain why innovation is important to the organization. 

From top to bottom, leadership needs to voice support and explain why innovation is important to the organization. For some companies, this will mean some big changes need to take place, which can be a daunting and heavy lift. If you’ve already identified your “why,” you already have a place to start educating your team and inspiring them to take action. 

The Innovation Imperative

Why do we see established organizations get beat out by agile and experimental startups with nothing to lose? Because the focus of established companies is processes, performance, and incremental improvements on an existing product. And while there’s certainly value in incremental innovation, it’s not enough to ensure the longevity of a company accustomed to dominating the market. It’s time for legacy businesses to stop playing safe, shape the future, and become the engine of disruptive innovation in their space. 

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