Organizational innovation is the implementation of new and novel practices that align to business strategy. Each change should provide ways of creating internal and external value – as well as solving problems and providing a competitive edge. In the COVID age, it has become a necessity in order to keep up with the pace of change.
The organizational innovation toolkit can be separated into four key divisions:
Sustained innovation is the pursuit of getting better at what you are already doing. For example, improving capabilities in existing markets – you know the problem, you just need the solution.
Breakthrough innovation is the exploration of untraditional skill domains to overcome complex or stubborn challenges.
Disruptive innovation is when things change within your business, for example emerging technologies or marketplace growth. The disruption you face may require innovation of your model, to cope with the current change and safeguard against the future.
Product innovation is the development and market introduction of new, redesigned, or improved products or services.
And each type of organizational innovation will have its suitability for a particular execution, whether that be expansion, competition, acquisition (of customers of talent), or retention (of customers or talent.)
The innovation life cycle
Also referred to as the innovation process, this consists of four key steps that must be followed in order to build a resilient and targeted innovation:
Gathering the insight involves having the relevant information and understanding of your industry and marketplace, in order to design a solution that is fit for purpose. Your exposure to new ideas and fresh takes, through consultation and networking, will also help to plug gaps and further tailor the end product.
Identifying the problem is a key observational practice, even if it sounds like an obvious step. Many innovations are designed to fix one problem and end up fixing another, because the instigators did not fully understand the challenge at the outset.
Creating the solution is the rewarding part of the process and is therefore often arrived at too quickly. Solution exploration must be deep and broad to ensure that the eventual creation is the best possible option.
Managing the innovation has traditionally fallen to research and development teams, but today is more suited to the remit of an experienced C-suite leader and change agent. Too much control will breed hierarchical chain of command, whereas too little will create an inefficient exercise.
Innovation management tools
Change at scale can be difficult to keep in check, particularly for inclusive organizations where every employee can have their input. Deploying a set of common tools can help to at least align everybody in their process, if not their ultimate outcome.
One of the most suitable and effective of these is prototyping. It can be applied to both products and services, and is simply the act of rapidly generating, improving, and regenerating on something so that it can be tested and perfected before release. This applies as much to services – in the form of trial runs and focus groups – as it does to more traditional product manufacturing.
Similarly, product lifecycle management involves the same practices but for the whole lifetime of the product. Handling a product or service as it navigates its infancy, maturity, and decline often requires several innovations to solve new challenges as and when they occur.
By understanding the divisions of organizational innovation, the life cycle of the process, and the tools available to take action – you are prepared to strategically innovate in pursuit of your goals. Whether it’s simply remaining agile enough to navigate the next COVID-19 storm, or to fuel a longer term project of growth – innovation is your pathfinder to success.
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