Two mindsets for innovative organizations
If an organization wants to start innovating, whatever the objective at some point the question is ‘HOW’. “How do we extend our market share?”, “how do we reduce operational costs?”, “How might we improve our relationship with our community?”, and so on.
In this sense, the mindset with which teams tackle different innovation challenges has huge implications from the perspective of methodologies, tools, tasks and in consequence, the final results of innovation projects. Which conditions define that mindset? Here is when business strategy connects with innovation objectives.
The goal of organizations is to create value. This can be translated into higher profits for shareholders, enhanced social impact for the community, achieve sustainability or improved user experience. These goals are accomplished by different actions intended to lower operating costs, increase income, enhance the business scope and improve the relationships with stakeholders.
This actions are based on the knowledge that the organization already has from itself, its market, stakeholders, etc, and are limited in the way they rely on the solutions already known by the organization.
As explained in “The Innovator’s Dilemma”, innovative successful companies explore niche market opportunities, that lead to disruptive innovation, while other large companies, usually market leaders, focus their innovation efforts in improving existing products for the existing customers. In this way, as innovation leaders and teams, we come to have two possibilities: Explore for new ways to create value, or Implement existing technologies and existing solutions, to create the same value in more efficient ways.
Moreover, these different mindsets are characterized by different priorities: When exploring, teams have the opportunity to ideate and prototype new valuable features, new channels and sources of income, for what it is needed to look for new (and new sources) of knowledge and insight, where it becomes more relevant to drive innovation efforts by an user-centred approach, such as Design Thinking.
On the other hand, when innovation efforts are driven by an organization centred approach, the challenge is to overcome technical difficulties and develop technical capabilities to achieve lower operating costs, optimizing existing channels, based on the knowledge available from the business processes and its stakeholders. In our experience as a team, we used Flow.ai to make the prototypes and architecture of our chatbot but used Azure to develop the alpha version of it. They both have for us huge differences in terms of time invested for developing it, but also in terms of costs and usability. For instance, Flow doesn’t require developers to make the chatbot because of its intuitive front end, while Azure requires hours of coding to be functional (here you can check the prototypes in Dutch made with Flow.ai or Azure).
Which approach should follow organizations? Both, and the way to achieve this is to have teams able to navigate between mindsets, to find new insight and adapt them into solutions for customers and the society in general.
As a result, our experience as a team from the Digital Society School has allowed us to explore not only solutions for our partners’ needs but also ways to achieve innovative results by navigating this two mindsets. Here you can find a previous post from Loredana Boghea, where she tells how we managed to use the “Elements of Value Pyramid”, from Bain & Company Inc., as a framework to lead our process between the exploration of new valuable features and the accomplishment of functional requirements.
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