The best way to embrace the future is to shape it.
Like evolution is to organisms, innovation is to organisations – a critical component that not only ensures survival but a significant contributor to long-term success.
As billionaire Shiv Nader succinctly noted, “adaptability and constant innovation is key to the survival of any company operating in a competitive market.”
Sadly, the term itself has been misinterpreted, misused and misunderstood and suffered through the trend cycle of business buzzwords.
To clarify, innovation is not a disruption. It’s not even an invention.
In essence, innovation creates value from new capabilities, often of existing resources. And creating value is the everyday mandate of any organisation – it ensures finding and keeping a customer.
“I think what people have to own is an innovation agenda, and everything is shared in terms of the implementation,” said Satya Nadella, CEO of Microsoft.
Yet, a large majority of organisations do not innovate. It is not part of their operations and it certainly isn’t pro-actively encouraged, recognised or rewarded.
So what does it mean to incorporate innovation in an organisation?
Put simply, it requires commitment to an iterative process of analysing the environment (internal and external), exploring opportunities and exploiting them, always allowing for risks.
For whilst all innovations involve embarking on a new initiative, most also require purposeful abandonment of existing practices.
Both of these have inherent risks but as Peter Drucker wrote more than three decades ago, “innovation by its nature is risky, as is all economic activity. But defending what was done yesterday is far riskier than making tomorrow.”
Successful innovation, like any management endeavour, follows the Purpose, People and Performance model.
Finding purpose requires interpreting unexpected successes and failures of the organisation, the industry or the wider environment and what opportunities they present for innovation. To consider aberrations and incongruities and finding solutions to them.
And importantly, not just in one’s own industry but others – not just customers, but non-customers. For discoveries, inventions, new knowledge and new ways of doing things have historically had their greatest successes in different industries, markets or applications.
Purposeful innovation is about observing changes in industry and markets, demographics, technology and human behaviour and looking for gaps and how to fill them. Always asking as Harvard University’s Clay Christensen encourages, “what are the jobs to be done?”
Secondly, innovation considers the people and strengths available to the organisation and how they can be leveraged to maximise the various opportunities on an ongoing basis. It also considers the compatibility and fit of the organisation’s culture and values to the innovation.
It asks the question: what of the organisation’s knowledge, competence, expertise, and strengths can we apply to this opportunity to solve a problem, do a job, or create value? How can our strengths contribute to the success of this initiative?
Finally, innovation initiatives must perform. They must be given adequate resources and information to do so.
In order to execute with any success, they must be appropriately empowered.
This takes discipline, commitment, and analysis, whilst at the same time being creative, curious and open-minded.
Performance requires innovations to have a clear set of indicators or controls – to provide everyone, including those working on the innovation, an understanding of their success, progress and contribution.
The right controls provide direction of focus ensuring they are as simple, small, straightforward and specific as they can be.
They also provide the necessary information for the next steps, encouragement, and expansion, abandonment or even re-direction.
For mistakes are a necessary trait of innovation. Recognising when they are made and rectifying them with little delay is important.
As one of this generations’ leading innovators, Steve Jobs put it, “Sometimes when you innovate, you make mistakes. It is best to admit them quickly, and get on with improving your other innovations. Mistakes are an inevitable part of being innovative.”
This article was originally posted on Nick Marvin’s Management articles.
Nick Marvin is a company director, management consultant, and author. Nick Marvin studied Business and Computing at Monash University and has an MBA from RMIT University. He is a Fellow of the Australian Institute of Management (FAIM) a member of the Australian Institute of Company Directors and the Turnaround Management Association. He was listed in the 100 Most Influential West Australians (2015 and 2016) and in 1991, he won Rolling Stone Magazine’s national writing award.
Marvin has been married to Leigh for almost 20 years; they have six children who are home-schooled. They attend daily mass at Victoria Park Catholic Church.