home Features, People Innovation is useless. Unless it creates value.

Innovation is useless. Unless it creates value.

Innovation and developing disruptive strategies dominate business discussions these days. The reason ‘why’ is clear. The ‘how-to’ is not. Indeed, it’s risky business getting it wrong. Rather than creating value for customers through innovation, many organisations end up playing a repetitive game of ‘me to’ with competitors that leads nowhere.

Innovation means change. It’s about doing something radically different in a way that adds value to your customers. But change can create fear and politics. Fear reduces performance unless you make people feel safe.

Obstacles to innovation

Most of the tools and methodologies we have out our disposal to manage and grow our business are the very things that may be holding us back. Most business cases to grow revenue will examine industry ‘best practice’, study the latest industry research and statistics and review current performance data and KPIs. We tend to look into the past where the eye is firmly set on the closest competitors and what they are doing.

The pursuit of ‘best practice’ keeps us in the same old competitive playground, driving markets into commodisation. Established KPIs and performance metrics mean we don’t challenge the status quo.

Challenging the status quo can be de-stabilising and fear of change emerges. The destination becomes obscured and success uncertain. The topic of innovation and being disruptive can quickly give way to retention of existing revenue sources and business growth. And as long as there is no crisis – why upset the applecart?

Business As Usual (BAU)

Mature organisations have invested in efficiency. Becoming lean and nimble was for a long time the way to assure competitiveness in the market. Continuously improving and making things faster, better and cheaper. The high-performance leadership team is committed to achieving their measurable ‘best practice’ KPIs. You can’t manage what you can’t measure, right?

Staying ahead of the competitor was the game.

Everybody is so “optimised” to keep the lights on and get things done, who has the bandwidth, let alone the brain space to think about, or even drive, this idea of “innovation”.

The issue with Innovation is how to do it – while keeping BAU going.

4 Real World Actions for Leaders to launch Innovation

One. Choose the best place to start:

Innovation is such a big topic and could be applied in any area of your business. To get started and ease people into a “new way” of doing things define an area to start with and extend later. Don’t boil the ocean, it creates too much overhead to manage. It has the risk to destabilise BAU.

Two. Build the team and give permission to break the rules:

The selection of the team is crucial. Diversity is a given. Avoid a selection of star achievers. You need to bring everybody along on the journey. Include the nay-sayers and the cynics. Consider functions and hierarchies. Think long and hard how the team will be led and how reviews will be done.
Most importantly – give permission to break the status quo rules. In fact demand it.

Three. Define goalposts – what constitutes the VALUE of Innovation:

If your team works hard on ideas, and you have to reject them, this may impact their motivation and enthusiasm. To avoid this, come up with your “Litmus Test”. What criteria must the innovation fulfill to be “valuable”? For example:

  • Can the idea be commercialised?
  • Is it profitable?
  • Is execution feasible?
  • Are the company’s core competencies leveraged?
  • Does it, most importantly, offer real, unprecedented value to the customer?
Four. Help your team to get it right – Pick a robust methodology.

To get beyond feel-good beer and pizza sticky note brainstorming sessions and deliver valuable outcomes – don’t let the blind lead the blind. It is not about somebody having a cool idea.

To weave the craft of Innovating into your organisational fabric, use a proven methodology, preferably offering a repeatable process. Blue Ocean Strategy or Design Thinking are tried and tested. Consider engaging an external facilitator or orchestrator who has no agenda, provides excellent stakeholder management, no bias and is there to enable and empower the team.

A way forward

True innovation is about delivering greater value to the customers we serve. It’s about being different in ways that really matter and add value. Most business leaders realise that innovation is a key driver for growth and profitability. They may have included the term in their corporate mission statement and values. Now there are ways for mature businesses to walk the talk and avoid the well-known Kodak moment.

Ursula Dauenhauer

Ursula helps small to medium companies to accelerate growth and revenue with their business. For over 20 years now, Ursula has helped numerous companies to grow their revenue streams and maximise customer lifetime value.