Leading Innovation from "Point Zero"
Critical learnings for organisations embarking on their innovation strategy
My innovation journey started with my PhD research in e-commerce in the late nineties. I researched the impact of online business activities on company performance and how to innovate in this digital environment. It was one of the first academic research projects in this area.
One of my significant findings was, those organisations thinking about digital transformation, and moving their business into a digital environment, would have to first reimagine the customer experience.
My research findings prompted me to refocus my career from e-commerce to innovation and explore the reimagined digital world. 25+ years later - I continue to help organisations reimagine their business.
I learned then that digital is not about technology. It is about humans. This is the single biggest reason why these days, digital transformation outcomes are not delivering the desired results organisations expect. The technology processes need to view humans at the centre when creating new products and services.
Today it is more relevant than ever. According to the latest BCG study, 80% of companies plan to accelerate their digital transformations, but only 30% of transformations succeed in achieving their objectives.
In this article, I share with you my innovation journey as a senior leader in an established top 20 ASX organisation - the learnings from my failures and the delivery of award-winning innovative products and services as well as innovation capabilities.
Key learnings from building innovation in establishing enterprises
During the years I spent as a senior leader in the corporate sector building innovation, four key learnings emerged:
1. Building a sustainable innovation function
There is a tendency to develop innovation in some pockets of an organisation led by ambitious and creative leaders and hope they might be successful. However, unless we embed innovation across the enterprise, our success will be limited. Leaders often rely on enthusiasts and volunteers and expect spectacular outcomes. This doesn’t work. Recent BCG research found that 75% of leaders are taking innovation among the top 3 priorities, but only half of them are ‘committed innovators’ - investing money into it. Imagine what would happen if we had the same mindset for other functions like IT, marketing, accounting.
2. Focusing on the right problem
At the beginning of my corporate journey, my biggest failure was not challenging initiatives in our strategic plan. With our accumulated knowledge over the years, we believed we could jump into solutions very quickly and build the business case on our own assumptions. We executed those solutions well, but the final deliverables didn't move the dial much. We ended up in a situation where we had “a nice landing at the wrong airport.”
The problem was we didn't question nor spend enough time understanding the problem from our customer/end-user point of view. The learning is to focus on understanding the problem well before you go further into a solution mode. At every step, check if your focus is on the right problem. For example, if we define a problem like “how might we develop face recognition when people enter our building?” it will put your team’s focus on face recognition technology. However, if we reframe the problem like: “how might we control who is in the building?” we open up for many other possibilities beyond just face recognition.
3. Building internal capabilities
We often believe that we can bring external experts to design a new solution for us. At the time, we experienced success in generating exciting ideas with external experts. Still, we often modified the ideas to the point that they lost their originality from their external experts’ handover. Not only that, we didn't intend to instil an innovation framework and leaders got an impression that this might be an expensive activity - they didn’t want pressure on their balance sheets. However, to build sustainable growth through innovation, we need to align the innovation strategy with our vision, build capabilities across the organisation, train people to practice methods and tools and prioritise fundings. So, yes, we need external experts to help us establish this roadmap, but we need internal people to drive it every day.
4. Defining bottom-up/top-down approaches
I'm sure you have read a lot of stats and articles talking about the importance of innovation. The research points out that a significant proportion of leaders put innovation as their top priority. However, a substantial portion of those CEOs is extremely unhappy with the outcomes from their innovation push. For example, the KPMG Benchmarking study found that 73% of leaders support innovation in their organisation, but only 6% are happy with the outcomes. There is no doubt that the CEO must be the Chief innovation officer. Whilst they can appoint a senior executive to perform that function, the entire organisation follows the leader, watches their signals, listens to their speeches, and observes their decisions. Imagine how people would feel if they got a call from the CEO thanking them for excellent implemented ideas. Employees are looking for direction on how they can be involved in the innovation process and what methods and tools they have at their disposal. If they have that available, employees would be engaged to push creativity and innovation bottom-up.
Helping companies on their innovation journey
After establishing best practices of award-winning innovation and design function in an established organisation, I made the decision in 2016 to start WAVE Design, a design and innovation consulting business, with the mission to help other organisations develop their innovation roadmap, build capabilities and reimagine their current offering. To my surprise, after 5 years working on the business, I have noticed many leaders are 'talking the talk’, but not 'walking the walk'. In my next article, I look forward to sharing with you the learnings from this journey.
Sources: BCG Study | BCG Research | KPMG Benchmarking study
Munib is an award-winning marketing and design professional with over 30 years’ experience applying innovation methodologies and human-centred design to create long-term impact for organisations. He has helped to shift the innovation culture at more than one ASX 20 company.
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