Maximizing your innovation investment in 2018

7 practical tips for execs

Eric Rich

By: Eric Rich
Blog

Since joining Elixirr, I’ve had the opportunity to work with several large corporate executives on their innovation agenda – specifically, the challenge of how to convert innovation initiatives into real top and bottom line impact… and fast. In this series of blogs, I’ll break down the components needed for your company to get ahead of the curve in a continuously evolving technology ecosystem.

As we all know, brand power and operational efficiency alone will not be enough for large corporates to survive in today’s business economy. The rate of change in technology is presenting tremendous opportunity for improved digital consumer experiences and the rapid introduction of new products, business models, and customer propositions. If large corporates are not able to adopt and embed new technologies into their business and IT architecture with speed, they will continue losing market share to FinTech, InsurTech, HealthTech, and every other emerging “tech” startup on the block…

Everyone is talking about innovation… but what do companies need to do to turn innovation into real business outcomes?

I’ve yet to meet an executive of any large corporation that doesn’t have innovation at the very top of their agenda. But, from my experience, most are just going through the motions when it comes to driving these initiatives…or just getting started.

Most large corporates have already established an ‘Innovation Lab’ either within the four walls of their existing facilities or externally in areas where startups are thriving. These labs are typically used by small innovation teams focused on scouting new technologies and running emerging tech experiments – with little or no connection to day-to-day business operations. Scouting and experimenting with new technologies are both great things to be doing. In fact, they are imperative… but I would challenge companies to map these activities directly to real use cases with short-term visible business impact. Most will find that to be a difficult task.

“There is no “one-size-fits-all” cookie-cutter model for industrializing successful innovation in large corporates.”

The other developing trend in the large corporate innovation environment is design thinking (DT) and rapid prototyping (RP). Talk to any business or IT executive today, and they’ll tell you design thinking has been adopted and is being used by their teams to run minimum viable product (MVP) sprints. Again, probably a very true statement. But, how many of these prototyping sprints are reaching the milestone of “successful new product launched to market” in an accelerated fashion?  Not enough… And those that eventually do are not fast enough.

The rate of change in technology is presenting tremendous opportunity for improved digital consumer experiences and the rapid introduction of new products, business models, and customer propositions.

Don’t get me wrong, large organizations are certainly getting better at utilizing DT and RP methods to run workshops and sprints. However, they haven’t quite mastered the challenge of how to embed this new way of working into day-to-day business – where all teams, functions, and capabilities required to implement a new proposition to market are present throughout the entire process. Without an end-to-end innovation operating model and culture in place, progress delays in developing and launching new products and offerings will likely occur, which, in turn, stagnates revenue growth.

So… what’s the magic formula for success when it comes to large corporate innovation?

There is no “one-size-fits-all” cookie-cutter model for industrializing successful innovation in large corporates. That said, from my experience in working with clients, it’s clear these important pieces of the formula need to be present:

  1. Identifying specific friction points in the business… First find out what isn’t working, then see what emerging technology exists that can be applied to solve the problem and implement it fast to drive business growth.
  2. Creating new business models for new propositions whether within or outside the current business. Companies should not let current operations and structures get in the way of forward progress – if a good idea is getting traction, be willing to find ways to bring it to market, even if that requires creatively launching a separate business.
  3. Changing existing ways of working to be customer-experience focused and continuously testing, iterating, and pivoting to align solutions to what customers are really asking for… rather than what “you think they want”.
  4. Ensuring funding is available to rapidly move ideas that demonstrate traction during customer testing into subsequent stages of development.
  5. Establishing leadership support, internal alignment, and readiness for launching new propositions with speed (including KPI alignment and adoption monitoring).
  6. Acquiring the right talent, capabilities, and technologies to develop, deliver, and support the solution once it has been launched.
  7. Forming partnerships to launch new propositions – companies must realize they can create the most value when they combine what they bring in terms of ideas, capabilities, customer-base, and distribution with customer-centric products and offerings of others.

No matter what the industry, these components will set the direction for driving results from innovation initiatives.

But it doesn’t stop there, in my next blog I’ll be delving into the detail about the journey to becoming an innovation-led business, and how to achieve real results.

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