Making innovation central to the new normal

New Thinking 1 November 2016 Ben Hayman

With Innovation sounding like a great idea, we’d all support it within our organisations. Staff want to know they’re supported in being creative and looking for innovative ways forward. It’s a no-brainer in many ways, but to create the conditions for innovation to become part of the new ‘business as usual’ takes framing and sponsorship.

We see patterns of adoption of innovation methods that create real change. We also see anti-patterns where innovation is a spike of excitement and activity and brings little ongoing change. The common pattern though is that the expectations of staff around innovation and the realities of how the business governs projects often clash. Innovation then becomes a vanity project or ‘exceptional’ activity on the sidelines of the business, rather than an investment of effort.

We’ve all heard the stories of the big brands that have failed to see disruption coming and got ‘Kodaked’. Or those that came from nowhere to ‘Uber’ a new reality in their market, disrupting all around them. There are certainly lessons, but the hype of the big success/failure stories can create an overly simplistic view of what it takes to create exponential and disruptive business advantage.

For those of us operating businesses created in pre-digital times, we can and should invest in innovation. There are clear models we can use for acceleration and lean startup that will help validate market needs and create stronger investment cases for new services and products.

It’s a very logical extension to operating a responsive business model after all as it’s laced with Agile methods and lean thinking.

A tool to explore models and ideas

More than this, these innovation methods also provide an opportunity to accelerate the validation of policy and strategy. It’s a powerful tool, not just for making code or ‘things’, but exploring models and ideas.    

It’s widely discussed that innovation spans three types of horizons which apply to existing organisations (rather than startups) in the following ways:

  • Sustaining – doing things differently, but inside the existing product line and business model of the organisation. The investor in this form of innovation is typically a project or programme of work that seeks to gain improvement in how it functions. The methods of lean startup apply, but integration with governance of the BAU has to be very tight and clearly supported
  • Adjacent – taking a lean startup approach to an existing challenge or opportunity and working to find what a good solution might be, but still within the boundaries of the organisation’s existing business model. In this case, the investor is often the executive or portfolio of the business
  • Disruptive – going ‘off brand’ to build a proposition that could change the market and force the business to adopt an entirely new business model. The investor in the research stage of this is the organisation itself, but the opportunity may well warrant external funding, venture capital or strategic trade partnerships to pull it off

At their heart, no matter what the horizon of innovation methods you’re working with, they’re all about validating needs and then candidate solutions with real-end users of the service or product. Co-design is the key.

Creating a community

If done honestly and as an ongoing activity, this creates a strong relationship with the end user, rather than an occasional and disconnected project or spike of activity. By operating an ongoing stream of adjacent innovation with the market deeply involved in co-design, you grow trust and can create a strong community while your products gain acceptance as they’re owned by the market. It’s a powerful way to merge your communications and marketing into the earliest stages of building or evolving your digital services.

When done well, innovation unlocks creativity in staff, the market and your customers. It’s an open and exciting style of working, so long as the business really means to do it and has committed to living with the implications of what it delivers.

We often say things to each other like ‘be careful what you ask for’. In the case of innovation methods, that’s the whole reason to do it. Ask for your assumptions to be disproven and find out what the market really needs. Do this in such an open and non-judgemental way that you’re happy, even if the answer is that your business has no part in meeting the need.     

Read more about creating a high-performance digital business and another core aspect – Responsiveness – 'Thriving times for responsive organisations'.