Taking advantage of the beginning of this 2018 I would like to share an interesting article published by the newspaper La Vanguardia de España on 07/01/2018, which simply lists the 10 tips that can help accelerate the innovation process in your company.
Innovation involves contradictions: it consists of generating disturbances and new routines in the normal functioning of day to day, which may destabilize the previous ones. We will assume risks voluntarily. But, if we do not get out of the routine, how are we going to create the next competitive advantage? How long will it take for rivals to become obsolete or to kill us based on price pressure?
To innovate, keep in mind the following:
1. Do not despise the power of technology. There are large self-satisfied entrepreneurs of their level of innovation, happy to innovate in business model, in marketing, or in organization, which only orbit around their classic value proposition. But, in the middle of the era of technological revolution, nothing will give it competitive advantages superior to its own technology. Nothing will generate similar entry barriers to the competition. Nothing has the disruptive potential comparable to a new technology.
2. Build an ecosystem around your company. Internal neurons are usually rusty for change, and overtrained to operate under the precepts of the past. Disruptive ideas and new knowledge will hardly be within the organization. The status quo will never lead the transformation. Outside (technology centers, research groups, expert consultants, startUps) you will find fresh ideas. Select the sources of innovation based on the individual, not on the basis of institutions. A prestigious university can have great professors, although disinterested in working with you, then manage to discretionally identify people with talent and cooperative will in scientific and technological environments (if there is everywhere!). Consult outsiders (outsiders, from other countries, other markets, other sectors) and organize open innovation teams that track opportunities.
3. Structure your information sources. Make the effort to obtain a minimum flow of gross ideas that can become great opportunities, coming from within your organization (although in this case, the ideas are usually incremental), from the outside (of your ecosystem), and from your own mechanisms of analysis and strategic information.
4. Act with a risk capital mentality: allocate resources (even if modest) to explore opportunities that are far from your core business. When you detect one of them, invest time to understand and value it. The first phases of innovation are research: analyze the context to reduce uncertainty. The economic resources should only be released, in a dosage form, when that opportunity is specified. Provide financial resources as your opportunity approaches the market. When the uncertainty is reduced, the investment can be increased.
5. Commits talent. It is better to dedicate a single person full time than 10 part time, innovating only when they have time for it. Select people: in the furthest phases of the market we will need visionary profiles and significant doses of leadership to pull the projects. Innovation and leadership are two sides of the same coin: there is no possible leadership if nothing is going to change. And there is no change without leadership, without energy that conceptualizes, communicates and convinces of the need for innovation.
6. Protect projects, especially in their most embryonic state. Innovation has a parasitic component: it absorbs resources that will not have immediate returns. Internal voices will oppose it. The old corporate culture will try to annihilate it. Innovation awakens the immunological system of the organization. If necessary, when the projects are far from the core business, keep them separate (in different contexts, labs, garages, incubators or similar).
7. Use specific methodologies. Conventional management fails in innovation projects, especially the most disruptive ones. You will not be able to do classic market research because there are no customers who explicitly demand your product, or who have imagined it before or can understand it. No financial projections for five years because your business model must change a hundred times until you find what the market really wants. You need to experiment quickly and cheaply to find the right user profile, and the optimal configuration of the product or service. Therefore, specific methodologies such as Lean Startup or Design Thinking are necessary.
8. Encourage innovation teams. If you really believe in it, you should not only choose the best talent to innovate, but you should give it back properly. The Human Resources departments must adapt. How about 1% of the sales of the new product as a bonus to the team, if it really “takes it out of the stadium”?
9. Take advantage of support systems, national or international. Entrepreneurship and direct or financial aid programs (locally or externally) are now highly encouraged. A good financial planning of the innovation reduces its cost significantly. Surprisingly, in the best times, the sum of fiscal incentives and public aid could make an R & D project practically cost zero. But do not let yourself be conditioned by it: your strategy should prevail over the programs offered by the system.
10. Discipline objectives, metrics and sets of indicators. Analyze your results. And, if they are not satisfactory, correct the process to turn your company into an efficient innovative machine.
(Article published in La Vanguardia, 07/01/18)
WHAT DO YOU THINK?