Many companies opt for innovation when faced with disruption in their markets. They think of an innovative product or service or even a new mobile app as a quick-fix for dwindling revenues or declining market share – a sort of nip-and-tuck or crash diet for the business that will help it look more attractive to its customers and shareholders.
The truth, however, is that innovation is something that happens every day in the world’s leading companies. Like a healthy lifestyle, it’s an organizational choice to do the right things each day to ensure the business’s long-term sustainability and growth. It’s becoming increasingly non-negotiable in a fast changing world.
Many organizations are threatened by the sort of digital disruption that Uber has brought to transport and WhatsApp to telecoms. But this is just the beginning. When self-driving cars move into the mainstream, for example, they’ll transform transport, insurance, city planning and many other sectors in ways that make Uber’s impact seem minimal.
The rise of new technologies like artificial intelligence (AI), 3D printing, and the Internet of Things (IoT), all bring with them a range of threats and opportunities for established businesses.
Innovators like Apple and Tesla don’t just react to these trends – they think about them daily, about how they can capitalize on them or even drive them. To keep pace, traditional businesses must think about innovation as a way of life.
Innovation is Not Ideation
One of the prevalent myths about innovation is the notion that it’s simply about brainstorming that single big idea that will change the business, the industry, or the world! In many instances, it is actually a hard-fought process of change, a journey where you might move forward in centimeters before you take a big step.
Cooking up good ideas is important, but innovation is about how to grow these ideas into revenue streams, business capabilities, or even whole new business models.
Just as you need to work-out to burn fat and build muscle, you’ll need to do some heavy-lifting to buff up your innovative ideas and turn them into business strengths. This means that the business needs to have a structure in place to allow new ideas to be conceived, tested, and then brought to life through disciplined execution.
Steadfast business systems like ERP and MRP are what enable an organization to create this structure. They provide the backbone to any business. A good ERP solution should be sturdy, but flexible enough to accommodate and support innovation and change.
Stick to the Fundamentals
Innovation must be underpinned by fundamentals such as rigorous market research and spending time with customers to understand their needs and problems. When one does scenario planning, it needs to be done in a manner that quantifies threats, opportunities and possibilities. These processes not only confirm whether an idea is a good one – they may also suggest other opportunities for innovation.
Big ideas, even great ideas, are commonplace. Good execution is far rarer. Innovation is a mind-set, a way of thinking, operating and being. It means thinking every day about where opportunities lie to do things cheaper, faster, better, or completely differently. It means having the capacity and courage to introduce innovative thoughts and practices into your routine business processes.