Sustainable Enterprise Innovation (SEI)
Part 1 of 2: External Pressures and Drivers
Opportunities for Sustainable Enterprise Innovation (SEI) have never been greater.
The emergence of the cloud-based digital enterprise is conspiring to put pressure on legacy systems, skills, and infrastructures. Disruptive technologies such as big data, social, and the internet of things (IOT) are adding to that pressure.
Consequently, these new foundational innovations are driving the need for still more innovation. As a result, everything from new business processes, policies, and infrastructure to the need for “full stack” technical resources and different delivery mechanisms are driving the need for more and faster innovation.
To a certain extent, this environment flows from the pent up demand caused by the 2008–2010 time period when the world saw a significant drop in innovation budgets due to the financial crisis. Large organizations hunkered down to weather the storm while reducing costs in R & D and headcount. Many great startups just simply dried up and withered away due to lack of capitalization.
The result was that folks made do with less, used baling wire and chewing gum on systems that were way past useful life, and did the best they could to hang onto their top resources. Just as important, the innovation engine provided by creative, nimble, and well-capitalized startups simply ran out of gas.
This created a huge gap in natural enterprise evolution not to mention revolutionary advances. Many organizations are now scrambling to determine the strategies and to find the resources necessary to catch up.
In some cases, they aren’t even sure what resources they need resulting in recruiters saying things like “We are looking for a developer that has 15 years of Hadoop consulting experience”. Of course, that is impossible as Doug Cutting and Mike Cafarella didn’t create Hadoop until 2005 and the commercial distributions did not come until much later!
The hype of Mobile, Big Data, Cloud, IOT, and other emerging technologies is in full swing and have many wondering how they can keep up, and just as importantly, whether or not the promise of these new advancements is real. The media and analysts are telling them that these solutions are critical but rarely tell them how it applies to their operations.
As with most highly hyped issues and technologies, vendors, marketers, and strategists jump on the bandwagon to avoid being left behind. The problem is — there are as many definitions of what these terms mean as there are people talking about them.
Consequently, you have people, whose day jobs are running the business and keeping the lights on, trying to find the time to unravel really complex concepts and decipher marketing hype. Unfortunately, this often results in the selection of solutions and the hiring of resources that simply do not suit the needs of the enterprise. This is why consulting companies are fairly busy these days — but that is a subject for another article.
All this is not to say that innovation and new technologies can’t be successfully implemented. They absolutely can. However, there are some indispensable components for sustainable innovation that every enterprise should incorporate in their strategy.
That will be the subject for Part 2
Part 2 — It’s Not Just About Technology
In Part 1 — External Pressures and Drivers, specific focus was placed on changes that are driving the need for Sustainable Enterprise Innovation (SEI). They include the emergence of the digital enterprise concept reinforced by the need to adopt new technologies related to areas such as Big Data, Mobile, the Internet of Things (IOT), and new collaboration approaches derived from social networking infrastructures.
In Part 2 we will explore critical strategies for enterprises seeking sustainable innovation and review some indispensable components necessary to ongoing success.
Three of the primary components include:
- Commitment by the top leadership to sustainable innovation
- A culture that rewards continuous innovation and experimentation
- An organizational structure that fosters innovation
The commitment by leadership is often tempered in public companies by the need for quarterly results and in smaller companies by the investors’ focus on cost and growth. While innovation is about smart people doing smart things, there is always both a real cost and an opportunity cost to such a commitment.
It is important to note that smart people will always innovate because that is what they do. However, they need time and resources to design and test before any real value can be realized for the enterprise.
If they are not given both, innovation is hindered and relegated to skunk works and hobby projects. In addition, because it is often hidden, it also leaves the organization without ever being implemented. It then later shows up in a startup or a competing organization.
Therefore, it is incumbent on leadership to embed a commitment to sustainable innovation into the culture of the organization. Of course that cultural commitment must be matched by programs and resources to be effective.
Such a culture encourages intelligent experimentation, inspires dreams, and rewards successful effort. Even failures in innovative efforts can sometimes deliver value in unanticipated ways. For example, the failure of a project to create a super strong new adhesive resulted in the wildly successful Post-It Note™ by 3M.
When associates are provided the opportunity to create, amazing new processes, products, and solutions result. Often, the tactics of an innovation culture might include team building, competitions, hackathons, etc. However, they can just as well be more relational or economic such as regular recognition and cash incentives.
In any case, they should be visible to the whole organization. One effective way to enhance visibility, that is also structural, is an innovation website that encourages ideas and collaboration while providing recognition and rewards. In addition, the marketing and HR departments need to team up with joint programs and incentive promotions that will increase sustainability.
Sustainability demands that enterprises establish strategies supported by such programs, structure, and frameworks to foster invention and advances. These strategies should never be a “one and done” if they are to be effective long term.
They must be dynamic and ever changing to reflect the different opportunities inherent in the organization, in the marketplace, and in various subject domains. Such strategies should leverage agile principles by biting off incremental pieces, testing and learning, and implementing incrementally again. Departmental labs and dedicated innovation facilities can be very effective, and when combined with collaboration and coordination across departments, the network effect often improves results and speed.
It should also be noted, that vendors can also play a role. Often, they are privy to ideas and concepts that can be great starting points or even self-contained innovations in their own right. All resources should be intentionally evaluated for their “innovation quotient” and leveraged accordingly.
Once an intentional strategy to foster sustainable innovation is established within an enterprise, the key to success is creating a powerful foundation for amazing advances. Those enterprises that recognize the value of innovation will ultimately create high value and competitive differentiation while attracting those people that thrive in creating new concepts, technologies, and systems.