Wednesday 13 February 2013

New idea generation is an important part of innovation

New ideas are the key to continued business success?

Innovation of products, services and business processes is important to keep a business up to date, competitive and efficient in the chosen marketplace(s) and new idea generation is a key part of that. These new ideas may result in profitable benefits such as the commercial exploitation of a new product or may deliver improved quality or services to clients.

Those involved in a business have new ideas all the time but often don’t act upon them or perceive it as “not their job”. So it is important to recognise the need to formally consider new idea generation.

If your staff  feel able to brainstorm and share some novel ideas for the business without fear of ridicule then you will be well on the way to giving permission to innovate by creating new ideas and acting upon them. That doesn’t mean that you take every idea and put it into practice but it does mean that it is given some consideration. Creating innovation requires a funnel of new ideas that can be assessed for implementation or discarded with good reason.

Innovations can be small incremental steps in improving an existing product, service or process or can be a game changing revolutionary leap. World markets now change so quickly that it is impossible to employ all of the skills and capabilities need to stay ahead of the competition. Successful, innovative businesses recognise that they need to look outside, as well as inside, the business to find ideas that will keep the business relevant in a rapidly changing environment.  Looking outside the business requires that there some time left over beyond operational delivery in order to work “on the business” not  “in the business”. That time can be used to identify great ideas from networks, seminars, competitors, customers and suppliers.


Why is it important to implement new ideas? 

Even the best businesses will fail if they don’t move with the times.  Consider the bookshops that went out of business as a direct result of the increased competition from online sellers like Amazon. The book shops that still exist changed their customer offering to a book shop experience complete with comfortable seating for clients to browse the books in leisure and a coffee bar to add to the relaxing experience.

Consider how you could cut the costs in your products and services whilst delighting your present and future customers. It will need to become a way of life to take innovation seriously. It can’t be something that is tried once in a while then forgotten because the day job got in the way. The competition won’t stop and neither can the drive to improve through innovation. Consider that competition wont only come from known competitors but also from disruptive and less obvious competitors. Who would have anticipated that the High Street Banks’ would have seen major competition from Tesco and M&S selling financial services.

What technology could disrupt your business model?  If you don’t already have an idea then the use of technology scouts or reports could give you valuable early warning of a threat to your business. Innovation can help to provide some answers to these threats but if you haven’t established a successful innovation process and culture within the business it will be too late to develop such a habit when the competition is already taking away sales from your business.

What can you do in your own business?

Aim to set a regular time to bring your team together to think about the future and what improvements you could make, what ideas have come from customer complaints or requests, new technologies which may be relevant or disruptive and create strategic action plans to assess and implement selected innovations.

Consider including innovation in your strategic planning process and updating status at least every 6 months.

Get yourself and team involved in relevant business and technology networks and with the most appropriate universities to get early warnings of potential disruptions to your business and also early identification of opportunities to grow the business through recognising new trends early enough to exploit them ahead of your competition.

Allow individuals with ideas the time to investigate them further.

Develop a stage-gate process to review new ideas as they develop so you can make well thought through decisions about how to proceed or even if to proceed

Ten key things that create growth through innovation

1.    Establish new idea generation processes in your company

2.    Develop opportunity assessment and strategic fit mechanisms

3.    Use horizon scanning to steer innovation and identify opportunities

4.    Protect your innovations by understanding intellectual property

5.    Encourage a company culture which embraces innovation

6.    Create internal processes to support the management of innovation

7.    Ensure capabilities and people match the innovation “mission”

8.    Develop external collaborations and networks to enhance capacity

9.    Make sure that resources for innovation are adequate

10.   Pursue market led innovation rather than technological push approaches

Innovation - what is it and what it isn't

Innovation is one of the most misused words in the business vocabulary.  There is widespread confusion between innovation and invention.  Invention is the creation and development of new ideas.  Innovation by contrast is the development and successful commercialisation of new ideas.  Thomas Edison was an inventor with hundreds of patents to his name; the light bulb was an innovation because the idea was successfully commercialised. Thus, while innovation is dependent on invention it is the business activities to deliver application of the invention and the full scale commercialisation that are important. 

Innovation is widely regarded as a key driver of growth in the economy and critically in individual businesses.  Businesses supplying innovative products and services have the unique selling point which create a market, encourages growth and support sustainable sales.  Innovation is a success and is therefore likely to be subject to imitation.  This fact has two corollaries: there is a need to protect the underlying invention from imitation, theft and other competitor actions with patents, copyrights, trade marks etc.; and one innovation is unlikely to be the enduring basis of a successful and growing business, not least because the patent monopoly expires opening the market to competition – an innovation portfolio needs to be developed, managed and exploited to keep your business ahead of the game. As demonstrated by Edison who had a range of innovations around his light bulb. 

Innovation is a critical business process for ambitious enterprises. An invention may be the foundation of the business; initial growth will be dependent on successful business development based on this idea: innovation.  Subsequent growth, will require further innovations, some of which may be large – the development of entirely new products, others may be small – further critical refinements of the initial product in response to market feedback.  Whatever the case, innovation needs to become an established process within the business to ensure sustained growth.  Innovative companies can cease to innovate and die, as demonstrated by swathes of manufacturing industry in the UK.
Established, even traditional businesses can be innovative; indeed in a crowded and competitive market place innovation is vital.  Flag carrier airlines fly between major cities paying significant landing fees at major airports and struggle to be profitable; what chance would there be for a small independent player to enter the market?  Low cost airlines fly to regional airports, where regional development agencies subsidise landing fees allowing these service innovators to charge significantly lower fares and drive the growth of their businesses.  Innovation is for all and certainly for all who want to be successful. 

Innovations may be made in product, process, service or management; wherever the innovation is made it gives commercial advantage.  Having secured advantage a high growth business will maximise exploitation of its position and seek further innovations to reinforce its long term prospects.  One has only to look to the likes of Microsoft and Apple to see this process at work and to appreciate the impact on the business if innovation is put at the very core of the business.

An Extract from the Oxford Innovation book: "One Hundred Ways to Grow your Business"

Edited by Dr Huw Edwards and Geoff Ribbens

Tuesday 13 December 2011

So why another blog about INNOVATION ?

Well if you work as a Business Coach with innovative companies as ideal target clients it is easy to assume that everyone shares the same words and concepts about INNOVATION.

In the words of Benny Hill "Assumptions makes an ASS out of U and ME" ASSUME - geddit?

So earlier this month my assumptions were challenged at a conference about Open Innovation. It was soon clear that people undestood completely different things from the word INNOVATION and indeed OPEN INNOVATION. I seemed to have arrived back in the early 2000s before Chesbrough's book had been published. There appeared to be a significant task remaining to agree nomenclature for INNOVATION related topics before a useful discussion could be had.

I reflected upon an earlier experience in may earlier work in the aviation electronics industry where one word stood for many different activities in the system development process: TEST. We only started to make progress in understanding this stage of a complex system development when we broke down the sub-stages below "TEST" and created an agreed naming for each of the parts. Until that happen "TEST" could have been replaced in the project plans with "THEN MIRACLE OCCURS".

This experience has made me see that there is still a need for clarity in what we call things in the INNOVATION process. That's what this blog is about.

Richard's blog about Innovation