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Innovation is a multi-facetted word. Leaving a lot of room for interpretation of what we mean. This create complications when defining innovation programs. Programs central for the digital transformation journey required for businesses to survive
Different interpretations of the word innovation
Depending on background, the word innovation can stand for a range of associations:
- Based on novel ideas – the mother of all innovations
- Smart solutions – making predecessors look antique.
- What inventors do – innovations come from a small group of the population.
- Coming from start-ups – As the cradle for innovations.
- A result of many failed attempts – to find a working solution.
- Patent granted or pending – an early question in a Shark Tank quiz.
But these words all suggest innovation as a niche activity for a few. Rather than something affecting all professionals.
Why innovation is a survival strategy in any business
The dependency on innovation grow with increasing business complexity and velocity. As business get more complex, old ways of working need become obsolete. And as the business landscape change quick, we need faster tools.
Innovation in its simplest form is to do things better than yesterday. Adapting to a new reality with a different approach than the one we used yesterday. Evolved to better suit today’s situations. Innovations are central in evolving your business. Or facing a high risk of fading away.
A reality where we need a broader perspective on innovation. Perspectives mobilizing all employees around an innovation agenda. All innovations don’t have to be big, take long time and deliver big results by themselves.
Two different types of innovation are crucial to exploit. Both innovative, but in different ways.
The least visible innovations. Small steps of improvements. Conducted by large number of employees. Where each innovation by itself deliver a small value. But generate large results by the amount of innovators involved combined with a continuous flow.
This type of innovations is suitable for:
- Markets behaving in a similar way tomorrow as today.
- Gradual improvements of current offerings
- Improvements of ways of working
- Tailoring of offerings to serve a broader spectrum of customer segments.
- Optimizing business models further.
The major business benefit is quick results. And the opportunity to address many small issues in parallel. Leveraging the combined experience in a business. Continuous innovations pay off from day one.
Disruptive innovation change businesses in a material way. Where you either catch the wave, or get caught.
Disruptive innovations are transformative in nature. Moving a market from an old to a new state. With a combination of technology, operational and business model changes enabling the shift. There is no path back when a disruptive innovation break through.
Disruptive innovations leverage inefficiencies in established markets. Over-, under or un-served customer needs. Or poor relationships between created value and the price to leverage the value.
There are two different ways to play the game of around disruptive innovations. As an offensive strategy for attacking incumbent providers. Or a defensive strategy first defending against the disruption but later embracing the disruption.
Disruptive innovations have larger upsides but take longer time to exploit. Your portfolio of disruptive innovations contains a few at a time. Where even fewer make it through the transformation zone.
Questions for you and your team
- What do we cover with our current innovation agenda – sustaining, disruptive or both type of innovations.
- How do we work with innovations today – a common approach for the two or differentiated.
- Do we start from customer jobs to be done at the customer end – or with innovative solutions looking for a problem.
- Which business results can we deliver the coming 12 months – expect pressure to see innovations deliver early.
- What are the next big waves we have identified – we want to explore or defend against.
- Where do we have different innovation initiatives in the maturity cycle – innovations are not easy to fast track on demand.
Additional reading suggestions
- What is innovation, 15 experts share their innovation definitions [BLOGPOST] – by Idea to Value
- Defining innovations [BLOGPOST] – by Management Study HQ
- 6 leadership behaviors drive continuous innovation [ARTICLE] – by Forbes
- What is disruptive innovation [BLOGPOST] – by World Economic Forum