“Innovative businesses grow twice as fast as non-innovators and they are also less likely to fail!”
BIS Innovation Report 2014
We’ve survived the recession and conquered the recovery. According to the IMF July report the UK is now in a stronger growth phase than seen in any other developed country. So, it’s time to sit back, rake in those profits and celebrate, right?
Wrong! The post recession world is a very different place. We now live in an always-on demand culture and this means that business life has to change or die. Slow development times and organisation-centred processes may have been acceptable just a few years ago but they certainly aren’t now. In recognition of this, 75% of CEOs say fast-changing market conditions are forcing companies to reinvent themselves quicker than ever before and 72% of major UK company directors admit their organisations are too reliant on fading revenue streams.
But knowing there is a problem and that business needs to change and actually doing something about it are very different things. It’s easy to talk the talk and sprinkle words such as innovation, agility and collaboration throughout company briefings and marketing reports but stepping up and transforming the culture to deliver game-changing performance and innovation-led growth is something else again. When only 18% of executives believe their existing innovation strategy is delivering a competitive advantage then I would suggest that ‘doing innovation’ is still a box-ticking sound-bite rather than a genuine attempt to transform the business culture and succeed at the new game.
So my challenge to all the CEOs out there is to be honest about the level of commitment that you have towards driving innovation-led growth and building the culture required to support it. And to get you started, here are ten questions to see just how serious you are.
- Is your approach focused on product or is the view that innovation applies to everything; brand, organisation, business models, experiences etc?
- Is taking ‘smart risk’ not only tolerated but rewarded or are risks ‘mitigated’ and chastised/frowned upon?
- Is your focus on continuing to protect your existing business model and trying to gain a bigger share of the existing market or reinventing yourself for the future?
- Do you have a ‚mix‘ of innovation activity (a balanced innovation portfolio) across incremental, differentiated and radical or disruptive innovation?
- Are you prepared to completely change your culture or disrupt yourself in pursuit of an innovation-led future?
- Is there organisation-wide tolerance for and exploration of disruptive, unconventional and controversial ideas?
- If there’s a strategic need to deploy resources for innovation outside the current organisational structure is there a process for it?
- Is there clear visibility of you and the senior team taking ownership, accountability and sponsoring the drive for innovation?
- Are you prepared to sacrifice parts of your existing business in order to provide real-world environments to prototype new ideas, experiences & business models in?
- If necessary, are you prepared to completely reinvent your organisation in pursuit of winning the new game and shaping the future through innovation?
I admit that some of these are tough questions to answer but they have to be. Instilling a culture of innovation is not just some buzz-word add-on; nor is it the preserve of a few people in one department. Those who are serious about innovation have to embrace the reality and potential for organisation-wide change. The World Intellectual Property Organization (WIPO) may list the UK in second place on their 2014 Global Innovation Index rankings; they may even say that this indicates that countries at the top have “well-linked innovation ecosystems, where investments in human capital combined with strong innovation infrastructures contribute to high levels of creativity” but there is still a long way to go.
Taking sport as an analogy, it is the difference between being world champion and everyone else. Champions may train that little bit more, fight to win that little bit harder but the main differentiator is that champions focus their every action into being the best. Where they live, how they train, what clothes they wear, what they eat, choosing their support staff…every aspect of their lives is focused on one outcome, becoming exceptional, becoming the best.
If you want to be an ‘Innovation Leader’ then you have to adopt a champion’s mentality. You can’t pick some areas of the business over others. You can’t drive some departments into creating new ideas or products whilst ignoring the infrastructure that will support those ideas. In short, for innovation to succeed, to be an enviable, innovation-led organisation, every aspect of the business has to embrace a culture of innovation.
I’m always surprised by some of the CEOs and senior teams I work with when challenged with sticky questions like the above. They’re deliberately challenging in order to tackle the elephant in the room in a head on way. That’s why I always ask for what I call ‘The position of truth’ i.e. let’s not kid ourselves about where the organisation is, let’s be honest and pragmatic so we can plot a course in the right direction. Taking the ‘sat nav’ approach; you need an accurate ‘origin’ in order to plot a course to a desired destination.
As a trusted advisor on innovation, my job is to stop organisations ticking boxes and help guide them towards the future. So, if you’ve answered the 10 questions honestly and you are serious about driving innovation-led growth, perhaps it’s time you got in touch.
Feel free to email Cris at email@example.com or browse our website further for more information on how Cris and his team help some of the world’s smartest companies succeed through innovation.