A quick little video from a keynote in which I outline what organizations often do — with good intentions that go horribly wrong.
Think about what happens — suddenly, a message is established that only ‘special people’ on the ‘special team’ are responsible for innovation.
Here’s what I wrote in What I Learned From Frogs in Texas — which, by the way, you can now buy for your Kindle from Amazon or for your iPhone/IPad on iTunes.
Three Simple Ideas
The essence of innovation is really quite simple. It is all about coming up with new ideas that help you to run the business better, grow the business and transform the business. But it isn’t just about idea generation—innovative companies excel at implementing these ideas and making them work.
Let’s examine each of these areas.
Run the Business Better
There is plenty of opportunity in every organization for operational innovation; that is, doing what you can to “run the business better.” This type of innovation involves a continuous effort to change, improve and redefine business processes, whether they involve customer service, HR practices, logistics and shipping methodologies, purchasing processes or just about anything else.
Never think there isn’t huge room for improvement—most organizations are inherently inefficient, with outdated or illogical processes in place. There is countless potential for improving the way organizations work, and plenty of opportunities for innovative thinking with respect to the way things are done.
Add it up and look at the benefits from doing things smarter or more effectively and there can be a huge return.
Grow the Business
Second, make sure you understand the opportunities from “growing the business,” or what might also be called “revenue-focused innovation.”
Most often, new revenue comes from new products and the ability to enter a new marketplace. Yet that isn’t the only way to enhance revenue. Think about business model innovation, for example: new business ideas involving expansion in existing markets or new ways of reaching the customer that weren’t previously possible (or that no one had thought of before).
Revenue enhancement can also come from changing the nature of existing products, such as adding a service component to a product that can bring in additional revenue. It might involve enhancing the perceived image of a product so it is more valuable to the customer, resulting in the customer being willing to pay more for it.
The key is, don’t think about “growing the business” and revenue enhancement as simply coming from new products or new markets; there are plenty of other methods for innovative thinking that can lead to revenue enhancement.
Transform the Business
Last but not least, always keep in mind the concept of “transformational innovation.”
Transformational innovation involves taking a look at the way the organization is structured, and thinking how it might be able to work smarter, more efficiently and with better results by changing the skills makeup of the organization. It involves constant, probing questions that continually assess the organization and its skills, such as:
Do we have the people we need in the right places/positions?
Do we have the right people with the right skills available at the right time?
If we are suddenly faced with rapid market change, do we know how to access specialized skills and talent we might need?
With the global connectivity that has emerged over the last few decades, there is plenty of opportunity to do today what couldn’t have been done even five years ago, in terms of how an organization accesses the skills, resources, talents and capabilities that it needs to get the job done..
Organizational transformation also recognizes the concept of “partnership” as a key corporate structure for the future. In a world of mammoth complexity and constant change, organizations must focus on their core competencies and partner with others to accomplish the things they cannot or should not do. In essence, they must recognize that the path to the future is to concentrate on what they do well and on what is critical to their central mission, and to seek partners to help out with everything else.