Successful innovation requires keeping pace with industry changes and the eve- changing demands of a fractured customer base. Companies that repetitively create, design, and develop profitable new products understand consumer behaviors and enable scientific advances. These firms capitalize on both internal and external systems to generate success in the marketplace.
Three factors impact innovation and can determine repeatable market successes. These are organization, technology, and culture. Let’s take a look at each element in turn.
At the highest level, an organization’s strategy drives innovation. A firm’s strategy reflects its mission (what is the purpose of the business), its vision (what will the future look like), and its values (what traits make us unique to accomplish our mission). An innovation strategy also informs internal and external customers of senior management’s risk tolerance. An aggressive innovation program indicates higher risk tolerance than an R&D portfolio fixed on incremental improvements and sustaining innovations.
Further, an organization’s strategy will determine systems and structures necessary for a corporation to conduct R&D. Traditionally, firms have followed a Stage-Gate™ approach to new product development (NPD) which allows larger risk (and larger investment) after smaller experimental phases are proven in the product design process. This is a balanced risk approach if the staged and gated system is implemented with cross-functional NPD teams.
Today, many firms are embracing Agile methodologies in which the focus is directed toward people ‑ customers and innovation teams ‑ over products and features. Time-to-market is faster and end-users test prototypes early in the developmental process to reduce waste. Planning documentation and contract negotiations are minimized, while customer interactions are optimized.
Almost all products today include a technical interface, whether it is a website or a smartphone app. Technology also plays a role in the development process itself. Most firms use some software tools to manage new product portfolios and/or the individual NPD projects. In addition, software tools and apps enhance communication for dispersed teams.
For example, product portfolio management (PPM) is a broad view of all new product development projects, including those being actively worked and those in the pipeline. There are literally dozens of PPM software packages available for organizations to utilize in aiding their decision-making. PPM tools collate individual project data to help senior managers view information and to make strategic innovation decisions. Most PPM tools translate gobs of data into simple charts, displaying value added project information in an easy-to-consume manner.
Culture is always the most difficult element to describe, and to change, to drive successful innovation. Many senior managers will point to organizational systems and structures or to technology when NPD metrics are not at the expected level. However, it is rare that only a technical or business solution alone can solve an ailing innovation program.
Culture sits at the heart of how things get done in an organization. Regardless of how aggressively an innovation statement is worded, if senior management acts risk-averse, R&D will be limited to incremental improvements and simple feature additions. Culture permeates team behaviors and individual work styles.
Agile work environments stress people interactions over documentation. Talking to customers is valued over contract negotiations with suppliers. Failures are viewed as a learning rather than punishment for falling short of a goal. Innovation teams are trusted to test prototypes with customers and to take responsibility for the whole product development.
Three elements impact innovation more than materials, engineering, or industry. These are the organization, technology, and culture. Factors like systems, structures, and strategies directly influence how innovation teams work internally and externally. Selected decision-making tools can aid or abet speed of innovation by increasing data and information flow or by creating roadblocks between senior management and team members.
Organizations should start with an examination of their overall strategy when seeking to enhance innovation. Strategies reflect the degree to which the firm accepts risks in NPD. PPM tools (technology) will translate individual project data so decision makers can actively assess innovation highest value innovation projects to pursue. Strategies and technologies are often a mirror to the organization’s culture. Culture is unspoken but determines how work gets done, rewards learning, and supports successful integration of NPD in an organization.
If your organization is struggling with innovation, especially in these challenging times, please contact me for a complimentary 30-minute innovation coaching session. With over 20 years of experience and innovation clients across all industry groups, I can help you get innovation on track for success! Contact me at area code 281, phone 787-3979 or email to info@Simple-PDH.com.
I am inspired by writing, teaching, and coaching. I tackle life with an infusion of rigor, zeal, and faith. It brings me joy to help you build innovation leaders. Teresa Jurgens-Kowal is an experienced professional with a passion for lifelong learning with a PhD in Chemical Engineering and an MBA in Computer and Information Decision Making. My credentials include PE (State of Louisiana), NPDP, PMP®, and CPEM, and I am a DiSC® certified facilitator. Contact me at firstname.lastname@example.org or area code 281 + phone 280-8717 for more information on coaching for entrepreneurs and innovators.
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