Corporate innovation that works is: Essential, Balanced, Specific, Diverse, Costly and….
Corporate innovation is one of the hottest issues in management today. Mangers are now expected to deliver ‘disruptive innovation’, and everyone, down to the last employee should submit ‘innovative ideas’ to improve performance. This topic of ‘disruptive innovation’ is so ‘disrupting’ that a Google-Trends search indicates it to be up 300% within the last 10 years.
So, here are the 5 (+1) most important things you need to know about corporate (disruptive) innovation:
Essential: The pace of change in today’s markets is growing faster. It is not going to slow down (as a matter of fact it will most probably increase…). It already affects even the ‘slowest’ industries such as the car industry (Tesla, Mobileye, Uber) real-estate (Airbnb, Wework…) and retail (Dollar-Shave-Club, Ebay, Amazon…). Sooner or later your industry and markets will be affected by some sort of innovation that might disrupt the classic way you do business. It better be you leading this change.
Balanced: Innovation by itself can never keep a business running. It is everyday money making operations, marketing, sales and finance, the back office of every organization, that must be diligently maintained. Not every person can be composer like Mozart, an inventor like Alexander Graham Bell or an innovator like Steve Jobs. Neither can every company act as Apple does. Therefore most probably it would be foolish to expect everyone in every corporation to be an innovator. Low innovation might result in losing market share, yet too much innovation might result in the loss of your cash-cow. Aim at wisely balancing current business with glamorous venturing.
Specific: You are not Google. Well… most of us are not. Hence adopting Google’s innovation strategy might be irrelevant to your business (in some cases, it might even cause damage). No two businesses are similar, hence every business should craft its own ‘Innovation Strategy’, carefully defining what, why and how is it going to engage in increasing innovation levels – and what resources are going to be allocated (yes… innovation requires investments…). Having a custom innovation strategy that fits your business will enable you to outline the right innovation balance, expected deliverables, build the relevant partnerships and allocate the appropriate resources. Strategize your innovation.
Diverse: Innovation has many faces. It can be applied to every aspect of business: product, technology, operations, business models etc. Innovation can vary also in its intensity, starting with small incremental changes, or growing to major, radical, game changing concepts. In many cases, some of the theoretically ‘small’ and incremental ideas could deliver faster and more predictable returns than the shiny disruptive ones. So, which should you prefer? Both, but NOT to the same extent: Build a balanced ‘innovation portfolio’.
Costly: There is always this fabulous story telling how a simple app or web site changes the world and makes millions. The Dollar-Shave-Club Youtube video cost only a few thousand dollars to produce, yet the company was sold to Unilever for $1.5B within only 4 years after its establishment. An amazing ROI isn’t it? Well. They had to raise about $163M in order to build such an amazing business. Ideas are cheap. Even those rare GOOD ideas, which are relevant, doable and indicate good returns, are cheap. It’s the validation and execution that are costly. Be prepared.
Last, but not least:
Professional: Hackathons, accelerators, open innovation, innovation platforms, ideations, competitions, patents, rewards, brain storming, co-creation, TRIZ, business model canvas, agile, spiral, SCRUM, SIT, blue Ocean, incubation, 20% method, and many other terms, systems and concepts are only a means to an end: to becoming a better, viable business. Use the ones relevant for your business, and use them right. Innovate professionally.