Just Innovate…

In last week’s Telegraph supplement on outsourcing the word innovation was used twenty one times in the first two articles. The (over)use of the term seems to elude to or promise a solution without really getting to grips with what the word really means or the effort required to implement. The lure is big with statements such as ‘However, although innovation can yield high profit margins and secure market leader status, suppliers need to recognise that it does not come without risk, especially in an existing contractual environment’

This is typical of the current level of communication (mostly from the Government) that suggests that innovation is really the only way out of the desperate situation that most businesses find themselves in. So what do these businesses actually know about innovation now or more likely, what do they remember about it? At some point in their early lives organisations were innovative, they had an idea that they developed and took it to market. It became successful and the business thrived and grew. They added to the idea and it was updated over time. This success required that they put in systems to ensure that they continued to be successful at what they did. These systems and processes were designed for productivity and efficiency and to deliver reliable profits and to reduce any potential risks.

Innovation has a high degree of risk and requires a different mindset and skill set in staff to deliver it and this is not typically the same mindset and skill set required to manage efficiency and productivity. These two drivers of a business will always be in conflict with one another yet we are now suggesting that innovation will now become the panacea for all problems. But if distressed businesses were innovating all along they would not be in the state they are currently in.

Organisations are simply not designed for innovation. So where does that leave them? Probably with a very steep learning curve, possibly with some problems around budgeting, definitely bringing some consultants in and with more than a few headaches and difficult decisions. I was very lucky many years ago to be in a meeting with the late Peter Drucker. My one big ‘take’ from the meeting was something that Peter had obviously repeated many times but still seemed to make him smile and that was “after all is said and done, more is said than done” and I suspect the same will be true with innovation.

Binge Innovation

In the UK we are all too familiar with binge drinking but are we familiar with ‘binge innovation’ in fact do we even recognise it?

By binge innovation I mean the period of intense activity around the point that a core product or service starts to lose buyer appeal, market share or in extreme cases, money. Naturally the response to this is ‘we need to innovate again’ but this call to action hasn’t been deemed necessary for the last five to ten years when the product or service was doing ok. The senior management team have relied on the tried and trusted indicator for innovation – the downward sales graph.

So generally the plan is to do enough to develop ‘the next big thing’ and then not to have to worry for next five years until the ‘indicators’ point down again. Ok, so there may be upgrades, updates and extensions to get them to that point but nothing fundamentally new. Design and marketing will play their part in extending the life of the idea but as we all know this life is getting shorter and shorter and it is getting harder and harder to deliver the next breakthrough product or service.

For many businesses, having innovation as a core competence will be a very advanced concept. Carrying out any sort innovation activity on a daily basis might also be seen as a challenge. Planning for innovation will be understood but likely to have larger gaps in delivery or at least not have the pressures placed on it that other more traditional planning cycles may have.

It is only when the question of  ’how will you actually achieve the predicted growth in your business plan’ arises that often the light bulb comes on. Innovation is all too often seen as a singular creative act, almost a lucky break. It is something that is somehow arrived at without process or planning, without a defined need or without resources to actually implement.

Innovation is not simply the aggregate of creative acts.

Innovation can be planned, innovation can and does have a process but most importantly it should have a clearly defined purpose. This purpose is to support, reflect and drive the business in its quest for growth. The business plan lays out this journey and describes and details the what, the innovation strategy or plan deals with the how.

More Innovation……

“Not sure if you can help, but we need more innovation?” the caller asked. “Ok” I said “how much do you have now?”

This is not the first call I have had with this type of request and I guess it won’t be the last. So my response to the question may be slightly flippant, but if the answer was more than the usual umms and errs we might actually be on to something.

So much has been written about innovation that I can only assume that what is available only serves to confuse rather than help.  Add to this the belief in certain parts of Government that innovation is the only way out of the current economic malaise for many UK businesses and the picture seems only more confusing for SME’s.

Sadly, starting any sort of innovation now, for the most is akin to asking a 40-year-old executive to run the marathon when you know that the last time they went to the gym was at university and they haven’t seen a pair of training shoes since.

We all agree that innovation is good (well mostly) We also agree that innovation comes in different types and flavours and that some are better or more suitable than others. What we can’t really seem to work out is how you actually start the process when you know that you need your ‘next innovation’ in six months time having not ‘innovated’ for the last ten years.

So where do you start? You need to understand what you currently have, what currently works, who actually does what and what it is you are hoping to deliver. I realise that this sounds over simple but how often do you or an external adviser actually look at the business to see how it creates things and gets them to market?

Delivering more innovation is relatively easy once you understand some of the key areas to successful innovation. We split these areas in to six for ease; leadership, people, culture, tools, process and ecosystem. This helps focus any review and to make identification of any recommendations easier to manage.

So before asking for more, think about what you already have and use this as a platform to improve and grow your innovation capability from.

Just the start

‘Innovate or die’ – how many times have you heard this refrain? More importantly how many times have you seen it and thought that this will never happen to you and the sales dip you are currently experiencing is nothing to do with your product offer or service approach merely a slowing down of the market?

Innovation is a word much overused and wholly devalued. It is word that is really easy to say, sounds great in the right places and vague enough to seduce the unwitting but really difficult to actually ‘do’ well. Everyone knows that innovation is vital (because we are told so by business leaders, Government officials and research) but the easiest course of action seems to be to either squeeze the margins, update, refresh or repackage the product in the search for differentiation and the need to demonstrate something new to both buyers and consumers. You want to innovate, you know the theory but somehow there are the other stronger more immediate business pressures to maintain the status quo. 

What is it going to take to get you to think differently?