Managing innovation is key to a firm’s success as long term sustainable growth usually requires a certain degree of innovation.
Innovation keeps your competitors in a constant catch up phase and delights your customers by increasing their value proposition.
Without innovation, you are left with sameness and that usually results in only being able to compete on price – which is not an ideal differentiator.
Managing innovation requires instilling expectation and determination that the entire team will strive to continuously innovate and that innovation will be key to everybody’s job.
The team should be paranoid about complacency and obsessed with a competitive advantage.
As a manager, you need to be making your team think about next year and the years following that. How will you remain competitive in these coming years?
New and improved products, services and processes will be key across the entire business platform… Manufacturing, Finance, Information Technology, Sales, Marketing, Service, Distribution, etc.
Innovations can be large such as radical or disruptive or small improvements to existing products and services such as incremental. Incremental improvements are crucial to keep you ahead of the competition – a continuous flow of these smaller innovations show that you are constantly improving, which in turn keeps your customers motivated to continue with you in terms of their supplier of choice.
Key to the process is maintaining a regular review cycle – this should be at a minimum every 12 months and should question what innovations that the team expects to introduce this time next year.
Ideas, plans and reviews should be quarterly with each business unit to ensure and maintain the momentum of a healthy stream of ideas.
Idea input should come from customers and staff and processes should be put in place to encourage this.
Staff should be encouraged to reach out beyond their usual domain. Get people out of the office and talking to suppliers, customers, and other businesses.
Customers are key to the idea process – try and think what job they are trying to achieve by using your product or service. How you add value to that process and make their lives better?
People always complain about lack of resource for innovative projects – allocate some time and budget specifically towards the innovation process.
People are also worried about failure. To help quell this feeling of failure good but failed attempts should be praised. Communicate to your team that it is expected that only a certain amount of projects will see it through to market.
Projects, of course, will still require going through the various stages of concept evaluation, market testing, etc.
Leaders should be made key advocates of the innovation process and this should have a similar level of focus as to what is placed on monitoring profit and loss accounts.
An alternative to managing innovation is to outsource your innovation projects; however, this too has its risks and complexities and therefore still needs to be managed well, particularly in terms of maintaining a strong and healthy relationship with your innovation partner.
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