Moving Innovation into our Core – Part Two

A three-part series on rethinking the management of the innovation system.

Part two, recognizing the broken process we currently have that stops innovation from becoming a core.

The innovation process and the structures build into our organization certainly need to be changed.

I outline here different barriers that require a change to bring innovation more into the core of a business.

Today, we are needing to build greater agility and responsiveness into our innovative design to counter a more rapidly changing market, sensing changing conditions and ‘seize’ breaking opportunities. .

A new combination of speed, flexibility, networking and focusing on adapting and fusing the skills and capabilities needed, will require changes in our innovation work.

Our current structures and processes for innovation are holding us back and will continue to not deliver the expected results needed today or the future, giving real growth and sustainability. We do need a far more radical approach to a solution for managing innovation inside our organizations.

The poor collective leadership of innovation, functional design, slow decisions and innovation not being focused enough,  along with a lack of appropriate skills or decision empowerment, are some of the inhibitors around innovation today.

We need to develop more agile and flexible processes that work more on outcomes that ‘seize’ the opportunity seen in the marketplace, emerging from greater (big data) insight, seen as strategically aligned and ensuring processes that shorten the ‘reaction’ to delivery time.

Firstly we have the strategic – innovation breakdown

The primary reasons for the breakdown in the strategic planning process that fails to connect strategy with operations are:

• A disconnect exists between corporate strategic plans, which typically define the company’s targets for growth, and their day-to-day execution activities.
• The annual operating plans are quickly out of date due to constant changes in the market, product, technology and competitive situations.
• The connection between corporate plans and the innovation strategy for new product development and product innovation strategy doesn’t exist in most companies – this is one critical gap.
• The operational side of the organization frequently doesn’t understand the strategy or how its execution connects to business goals.

We forget to alter our ‘thinking’ across different opportunity horizons, to direct resources around those innovations that address 1) the burning needs to improve on the existing here and now, with those that can build into the 2) next and different winning positions and finally, those that 3) explore fundamental different premises that can (radically) alter your innovation landscape. Mapping across all three is often missing, we stay trapped in the ‘here and now’ mindset far too much.

To achieve consistent, sustainable long-term growth and profitability in your company, you must have systems and processes in place to close this gap and connect your corporate plans with innovation strategy and operational activities.

“Our planning sucks, how can we be more responsive”

There is the fashionable argument that you abandon annual plans and you seek fresh planning ways to create an organization ready to react to critical changes in the marketplace. That is great for the little fella, all nimble and lean but for the larger complex organization, they struggle.

Each of the different organizational parts has different reaction and response times, are governed in totally different ways. Plans are essential as the instrument of strategic design but how can these become more reflective and responsive, this is a real thorny problem to crack.

A recent report by Strategy& suggests being more agile requires a clear focus on two attributes of ‘strategic responsiveness’ and ‘organizational flexibility being built into the design of the larger organizations so they can move far quicker as conditions change.

A combination of ‘sensing new risk and opportunities to craft quick responses and also being able to “shift execution rapidly”, applying fast retooling and rework, applying this progressively over weeks and months.

For innovation to fit within these challenges much of the current process and structures need to be changed.

Any ‘rapid action’ requires very different skills and infrastructure to support it.  Organizations will need to encourage a higher level of experimentation, with even more of a constant focus on reducing all the unnecessary complexity.

Reducing all the different concepts going through the pipeline with more corporate-wide support to drive these through the system to meet these critical new opportunities that meet changing market needs or strategic goals. To do this alignment becomes essential.

Pulling together the broken pieces and silos of knowledge will need different approaches

The operational areas in an organization have their own functional execution systems which are often not connected to planning and innovation systems and processes. They remain separated as there is no real depth in the integrating process, this needs addressing.

High degrees of resistance and communication breakdowns need real solutions.

I’ve written extensively on this lack of alignment (for example) and certainly believe there are far better ways to move forward in thoughtful, constructive ways that begin the movement to establish a clearer innovation management system.

Also we focus too much on cascading down organizations, I would argue the cascading effect of flowing back up, from the ‘grass roots’ needs a far more robust system, it provides for a deeper choice of better, connected decisions. It is this ‘cascading’ both up and down on where we often lack the real alignment and fail to incorporate it within our future plans.

Leadership constantly laments about ‘poor innovation’

Many organizations are failing to build and nurture any design toward the ‘innovation ecosystem.’ We are also not formulating and communicating where innovation links into strategy, we are not connecting all the different parts. Innovation stays often poorly articulated, lacking an understanding of what makes up a holistically designed innovation ecosystem.

Often innovation ‘appeals’ because we can build compelling stores. Organizations are poor at building a compelling narrative and lack the skills and communication methods that will engage us.  Innovation understanding is often left to others to interpret what it means to them to figure out their part, with a hope that their decisions will fit somehow.

Because there is often a lack of internal clarity, there is also a poor connection to the external environment where opportunities are never recognized for their internal value to develop. Leadership lacks much in addressing these issues.

We constantly fail  in building lasting client value

Equally, where the customer remains dissatisfied with the present offering, as one not meeting their explicit needs and where they often have to continue to compromise, they are ripe for change.

Often the very leadership of organizations has a less than adequate ‘grasp’ of all the necessary levers for clients’ innovation ‘need’ to not design this in a sustaining, repeatable process with constant customer engagement they keep this ad hoc, project-specific, they miss ongoing value building opportunities.

Innovation stays resolutely one-off, targeted and specialized and disconnected from planning out a series of solutions built through a well thought through a road map of evolving value that builds for the longer-term lasting client engagement. There are notable exceptions here, mostly based on technology solutions, constantly evolving, adding increased benefits over time.

There is such a disconnect going on in ‘talking and walking’ innovation.

The organization ‘demands’ innovation, the leadership presents innovation at every opportunity, often more as a ‘fig leaf’ for the embarrassment that eventually arrives, as innovation in the marketplace. We need to set up a real connection between rhetoric and real value, delivering substance, not just ‘promise’ or intent.

The leader needs to engage become the source or energy point to make valuable innovation really happen, no one else can. It cannot be simply delegated away.

Who wants a leader that simply delegates growth, new wealth creation and your future to others? The need to both ‘walk and talk’ innovation consistently not just in annual meetings or board reports but in their daily engagement and detailed understanding of what makes innovation happen..

We also need to become far more comfortable with our own emerging practices.
I just always feel uncomfortable with the reliance placed on copying others’ best practices. It is inherently wrong for your organization if it believes in its unique design and the offerings it can deliver upon.

If you want to simply copy then seek out best practices and enjoy your ‘race to the bottom’.  By all means, there are good practice solutions to learn from but if you are dependent on others’ best practices you need to kick the habit fast.

Your specific organizations needs its unique design to seed and cultivate innovation, otherwise, you fall into a  trap many constantly fall into. We need to work on our emerging practice as we learn through our own endeavours, far more than copying others. We need to capture these in our systems and processes as our stories and practices.

The constant switching on and off of our innovation activities.

Organizations constantly do this by switching on and off, believing by pressing the innovation button, it springs back into life and delivers on-demand.

We just can’t simply switch innovation ‘on or off’ to meet short-term needs, it is certainly not faddish, it provides future wealth and sustainability and needs sustaining and nurturing consistently.

We need a system that not just monitors the innovating health of the organization but its variances are as vigorously discussed as any operational variance.

Switch innovation ‘on and off at your eventual peril, as you will eventually short-circuit the organization and the source of your future will simply drain away. People leave when they see no future or are fed-up with all the constant change We need to make innovation our core to drive future organization performance and keep it burning bright for all to see and ‘fuel’ into to make it sustain.

An Enterprise-wide innovation process that provides transparency and visibility.

If the leadership of the organization fail to formally integrate innovation into the core of any strategic – management agenda, so that is ‘constantly running through’ the decision-making process of innovation, it will remain disappointing and frustrating in its impact and results.

With the increased disruptive competition and rapidly changing conditions in markets, technology and demands placed on organizations, innovation need to be more central in the design and its management.

The leadership need to close the gap between aspiration and execution of innovation, make it more central in their thinking and activities, delivering the explicit message for everyone up and down the organization to feel more confident that innovation is a core focus and needs development. Make it highly visible and central.

Our leaders need to explicitly lead and manage innovation

Leaders not only need to demand change to come from managing innovation, they need to create this case for change and must ‘make it happen’ by demanding all the connecting parts be understood, designed and delivered, in a more sustaining innovation process.

They need to see a solution that provides an Enterprise-wide innovation process built upon making all the connections for innovations complete understanding, not on selected parts.

One that can deliver organizational-wide visibility and transparency, designed for achieving the greater strategic responsiveness needed from the top and able to give back the organizational flexibility, and flexibility in adjusting resource commitments to meet changing needs.

A redesign that is not linear but adaptive and dynamically evolving, based on changing intelligence and knowledge, to bring greater agility and faster decision commitment into its design, something that our present systems do not have designed into them.

****My Additional Note: Recently I provided some opening thoughts into a debate on what is missing for our future, here is a link into a part of the deck provided to prompt that part of the discussion.**