ORGANIZATIONAL DEVELOPMENT: INNOVATION STRATEGY: PART I

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For innovation to be successful, it needs to be more than an incremental plan. Innovation must become an organizational mind-set or orientation that uses the collective intelligence and imagination of people throughout the enterprise. Each member of the organization should see a clear line-of-sight from the innovation strategy to his or her job. People in all areas must develop a high degree of commitment and passion to create and capture the future! Innovation must become a process of object-driven change, which remains flexible with regard to both objective and the path to get there.

In practical terms, the innovation strategy requires the development of people and processes capable of grappling with continuous assessment, development, and the implementation, of customer value added products, services and processes. These products and services should be aligned with the current, future, and the possible future of your industry. Beyond products and service, innovation can also be built upon demand for what the organization can offer through effective “branding” and creating customer driven desire toward doing business with your organization. Think of your innovation strategy as a living and continuous transformational process.

Because of the importance innovation plays in the future success of the organization; the process and the many factors affecting a systemic approach to developing an innovation strategy will be discussed. As is the case for developing any strategy, it is critical to investigate the linkages that innovation has to other strategies especially the business strategy of the enterprise.

Innovation is more than simply a “big idea” and the product or service that results from it. Innovation can more accurately be defined as “a process” through which the total available knowledge (internal and external to the organization) can be strategically translated into new products, new services or an increase in meaningful productivity, through new and improved methods. It is the complete process or system of interactions between the innovator and those individuals in the organization who can move the innovation from the idea stage, to research and development, to commercialization, and on to implementation and use by the customer. The creative use of product branding, organizational structure, cultural values, and optimization of talented people within the organization is in fact the practice of innovation because collectively they are building an environment driven by human imagination, which is at the heart of innovation.

An innovation strategy defines to what extent, and in what timeframe, the organization wants to use their knowledge and innovation to execute its corporate business strategy. The combination of a coherent innovation and business strategy are key components to the long-term success of the organization because they address the ever-changing business environment, allowing the organization to maintain a sustainable competitive advantage. An organization should continually be asking the question: How do the “innovation initiatives” support the business strategy of the organization, our clients, and the industry it serves?

In a “knowledge-based enterprise” innovation tied to the business is critical for two main reasons. One, “Knowledge Capital” has a relatively short shelf life. (New knowledge is constantly being created worldwide) Two, Change and access to knowledge is happening at a faster rate as the world becomes digitized. Bottom line…in today’s knowledge-driven world, new technologies appear at shorter and shorter intervals. In this environment we must become experts at mastering a continuous innovation strategy. If as an organization you are not diligent in pursuing an innovation strategy, someone can reinvent your industry making your products and services obsolete in a relatively short time. Quoting Bill Gates, “We always work as if we are two years away from bankruptcy.”

Strategies describe actions required to enhance the strength of the organization, relative to the competition. This is particularly true of an innovation strategy. Innovation strategies can be driven by: the customer, competition, technology, breakthrough transformation, stakeholder, resource, project, culture, or a combination of all of the above. A good innovation strategy considers all of the above so it can have the strength and durability to bend and change with new information, but does not disintegrate under the force of unexpected change. A good innovation strategy is like a good topographical map. It details the major land obstacles, mountains, rivers, lakes, valleys, canyons, (competitors, technology, customers, suppliers, culture) so a plan can be formed, but allows all who use it to pick the best route to get there in the quickest time. It is a guide that provides as much critical information to be available as possible, and also allows for the unexpected and unpredictable to play into the equation.

If an organization is to truly become innovative, the following four critical tasks must be undertaken.

• Understand and confront reality. Understand how your industry is doing, how technology is changing, how internal and external strengths, weaknesses, opportunities and threats are changing so the organization can stay on the leading edge rather than on the trailing edge of change.
• Truly stretch the organization beyond its current actual and perceived capabilities in an effort to achieve “breakthrough” transformational innovation.
• Obtain, create and sustain a substantial amount of intellectual capital and the organizational culture of focused energy required to discover, develop, implement and accelerate transformational innovation.
• Paint the big picture by clearly articulating the major elements and processes required by the entire organization to foster a total systems perspective, which allows transformational innovation to flourish.

All of this effort must be closely aligned with the mission, vision and business strategy of the organization and be clearly communicated to all stakeholders. On communication, George Bernard Shaw said, “The greatest problem with communication is the illusion that it has been accomplished.” Certain key people may know and understand what the organizations innovation strategy is; however, the more who know the better will be the support and focus. As in all strategies, an innovation strategy also contains an element of risk. With regard to risk, excessive risk exposure can be greatly mitigated when leadership advocates, and deliberately orchestrates, all elements of the strategy by facilitating the best use of available intellectual human capital, and by realigning resources and the work environment to support the innovation strategy initiative.


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