By: Dr. Irene Spitsberg, the Managing Director at InnoVentures LLC
There is myth and mystique surrounding innovation, namely that its key lies in finding great ideas and selecting the best ones. However, this quickly dissolves when these ideas meet the challenges of execution. The troubling fact is that as companies are pursuing entrepreneurial and intrapreneurial and efforts about 70 to 90 percent of these initiatives fail.
Based on my experience, the reason for most of these failures is that, inspired by showcase successes and seeking to quickly transform their organizations, leaders end up pursuing various initiatives to adopt new promising trends. They quickly lose focus captivated by the advice available in literature and media about how they should go about innovation: what they should do and how they should do it.
As innovators, we know that innovation delivery cannot be accomplished by simply replicating someone else’s approach. As much as we are inspired by great concepts, (e.g. Design Thinking and Agile Innovation), the reality is that successful implementation of these concepts within organizations can only come from a holistic approach – one rooted in deep insight and that takes into account an organization’s structure, culture, and business systems. You need to understand why things work (or don’t work) and to apply the methods that have the greatest chance of success in your specific context. In other words, you must identify your own unique pathways to success. To achieve this, leaders need to crack the code of innovation delivery.
From my own experience leading innovation teams inside top global companies, I have identified seven key drivers of success that, when implemented as a system, can transform your innovation capability. I am sharing then here:
7 Key Driver of Success:
Setting innovation objectives. Achieving a clear and shared understanding of your innovation objectives has a profound effect on the ultimate success of your innovation efforts. This is true both in terms of gaining sustainable organizational support for new ideas, and ensuring that you have the right capabilities to execute on these ideas. Clear definitions help articulate the type(s) of innovation: sustaining or new; proximity to the core in terms of technology and market “newness”; and the percentage of organizational resources applied to various types of innovation efforts.
Ideas generation. While it is true that ideas can come from many sources within or outside an organization, they never arrive fully formed. Successful innovations come from a deep and systematic examination of the market, technology and business ecosystem. This requires the right skills and an effective, systematic process for processing insights and “connecting the dots.” It is through this process that great ideas are identified and developed as potential new offerings, which can then be realized by your organization.
Dealing with uncertainty. Successful new growth programs use a systematic process for identifying the riskiest areas and deploying plans for quick learning and market experimentation. The internal focus on preparing the organization for market delivery is just as important—if not more—as testing market acceptance.
Managing risk. Once your idea is identified and selected, you need to work relentlessly to define and communicate its business value. You have to get quantitative, or at least semi-quantitative, even for early stage ideas. You do this by identifying key drivers of the economic value and making assumptions about their values based on the best available data.
Bridging credibility gap. Understandably, investors are concerned about investing in high risk projects. To sustain funding for your new natives when competing for scarce resources, you need to be very effective in how you communicate with investors and stakeholders. The project team needs to be able to articulate how the idea was shaped and why it should work. They should also present the idea’s economic value, provide opportunities for investment staging, and show clear plans for mitigating risk and increasing the upside.
Alignment and flexible resource deployment. Even with top down sponsorship, your innovation initiative largely relies on bottom-up execution. From the start, one of your top priorities should be devising a strategy and process by which the organization’s resources will be “recruited” into the project, as it matures from the idea font end towards the back end of execution.
Empathy. Your organization’s members are typically “in” to support innovation. But uncertainty and the unknown cause them to feel a great deal of anxiety when they are required to take actions that might disrupt the exiting priorities. So it is critically important to not just “ignite” with ideas but also prepare the organization to support them. Establish a common language around innovation and educate employees or stakeholders on risk reduction approaches. Relate these approaches back to known methods for dealing with operational risks. Educate and engage through frequent communication. Combine storytelling to inspire with presenting evidence to convince. Be prepared to walk in their shoes and offer practical help when necessary.
About the author:
Dr. Irene Spitsberg is the Managing Director at InnoVentures LLC, a strategic innovation company, where she works with Fortune 500’s as well as smaller companies on their toughest innovation strategy and execution problems.
Irene was the key strategist and driver in establishing Innovation Ventures Group at Kennametal, where she was responsible for multi-national cross-functional teams working on the development and commercialization of new offerings in adjacent and new spaces. Her other roles included Director Global R&D Business with Cristal and a number of technology leadership positions with GE Aviation. Known for developing and implementing leading-edge innovation management frameworks and organizational solutions, Irene is a frequent speaker and author on the topics of Innovation management. Irene holds a PhD in Material Science, is the inventor or co-inventor for over 80 US patents, is a leading author of two featured papers in Research-Technology Management journal and is a recipient of NASA’s “Turns Goals into Reality” Award.