Innovation: when the talking has to stop
Innovation is one of the most important ideas in business, but so many people — and companies — talk about how innovative they are that the word no longer has much meaning. Instead, it has become a trigger to get consumers excited about new products or features, and makes companies feel that they have to act fast or risk being left behind.
Boards are easily caught up in this kind of thinking: they want their business to be more innovative, so they create an innovation function or they hire a chief innovation officer. But if becoming more innovative was that easy, every company would be doing it.
Despite the claims of innovation consultancies, most companies do not suffer from a lack of innovation if that means coming up with products and services that customers want. Businesses that thrive are inherently innovative in these terms. No, the problem they face, particularly as they get older and bigger, is how to respond quickly and effectively to a market that is changing around them. This is especially true in the mobile world, where consumer behaviour is shifting and people, both in their personal lives and at work, want to alter the way they do things to benefit from the freedom and flexibility that mobile can bring.
No one can reliably predict what changes are around the corner and the effects they are going to have. Take the technology industry: Cloud services, big data, wearables, artificial intelligence, the Internet of Things — all of these, we are told, are about to transform the world of business and our lives as consumers. Therefore, they are seized upon as areas that smart companies must target for investment.
But history shows that the biggest innovations often unfold without anyone realising their importance at the time. The explosion in touch-screen technology is a great example: it wasn’t something that innovation experts were telling everyone to focus on five years ago, but since then it has changed the world. The biggest impact has been on consumer behaviour; now mobile is the favourite way to carry out transactions of all kinds.
The point is that for most companies being innovative means responding effectively to important trends that they did not predict, and reshaping their offer to take best advantage of the way their market is moving. That means having processes for product development and service design that are sufficiently flexible, and empowering the right talent within the organisation to lead such projects.
Very often, people equate innovation with entrepreneurs and start-ups, while established companies are seen as bureaucratic and slow-moving. That is an attractive idea but it’s a caricature: a huge amount of valuable innovation comes from large companies with long histories. They are able to do this because they value their “intrapreneurs” — employees who bring an entrepreneurial spirit to their work that can allow the business to think differently and move in new directions. These intrapreneurs are often also the staff who enable companies to collaborate more effectively with their external partners: suppliers, consultants and so on.
Similarly, companies often assume that being innovative involves moving as fast as possible. Again, that’s a myth. All businesses are different, and for a company that works on an annual cycle, a project that takes three months to deliver can be more genuinely innovative than one that takes two weeks. The important thing is to avoid the clichés around innovation and concentrate on getting the right people, structures and processes to deliver meaningful change.
This isn’t something that a business can achieve just by hiring a hot consultancy or supplier; if it can create the right partnership between insiders and outsiders, however, great results are possible.
There is far too much talk about innovation in business, especially in technology markets, and not enough recognition that getting it right means focusing on business culture and organisation — not just the products and services that emerge at the end of the process. Talking about innovation does not make you innovative.
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Originally published at chelsea-apps.com on February 24, 2016.