Part 1 of a 4 part series on 'Putting Innovation into Action' in your organisation.
Innovation has become one of the business buzzwords over the past decade at least. The phrase gets thrown about, it appears in organisations values, mission statements and leadership development programs, and leaders and CEO's stand up at all staff meetings and proclaim "We're going to be innovative!! Let's get going!"
One of the key issues I hear from people in organisations (generally out of ear shot from their manager or co-workers, or over a scotch late at night) is that they don't even really understand what the word 'Innovation' actually means, or what it could like for their organisation or team. (if you do know what it means and what it looks like, you can stop reading now, and get back to innovating!)
We tend to associate the word 'innovation' with only the most revolutionary or game changing tech, products or services (like Airbnb, or Netflix, or Amazon Dash). But in reality, innovation can be anything from the smallest improvement in a process, or service, right through to the radically different products, services and technologies that change our world. Innovation is not something we should shy away from or be scared of, but rather embrace it and give it a go!
That’s why, for me, I like to think of innovation as simply 3 parts:
Innovation is: The act of having New Ideas (no matter how big or small), that unlock and add value, and are made real.
I find it easier to relate to what innovation is when I think about it this way. You get New ideas; from staff, from customers, stakeholders, communities, boards, groups, and realistically, anyone, that create some form of new value; Faster, smarter, simpler, cheaper, more efficient, a better experience, etc and most importantly, that are made real; executed, implemented, integrated, actioned!
Steve Jobs said “To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions” And I agree with him. (I’m sure he would be pleased to have known this!)
Having new ideas, that add value is simply creativity or imagining. It's the making it real that is the actual innovation, but you need all three.
It’s kind of like an analogue clock – it has a face, hands, and batteries – and it needs all 3 to work. Innovation is the same – it needs new ideas, that unlock new value and that are made real.
Air New Zealand's self service kiosks are a great example that we can all relate to. They had an idea to allow customers to self serve, the value that it added was less queues, less staff, faster throughput of passengers, and they made it real. (I know that I have totally over-simplified this example, but it's in essence what happened).
I remember when they were first implemented, and I would arrive at the airport and quite smugly walk past the long queues at Qantas and Jet star, and other airlines, and go straight to a the machine, check in, get my ticket, and be done. They had an idea, that added value – to them and their customers - and they made it real. Boom. Innovation in Action!
So, what else does Innovation look like?
Current research classifies Innovation into 3 primary types – Incremental, Breakthrough and Disruptive/Radical.
Incremental Innovation is also often referred to as continual improvement, but this is still innovation (and it sounds cooler!) Wouldn't you rather say that you were working on 'incremental innovation' rather than 'continuous improvement'?
Incremental Innovation globally represents around 70% of innovation efforts, and is generally at the operational level and making small improvements to add value to existing products, services and processes - things faster, smarter, cheaper, better, more efficient. The key to understanding incremental innovation is that is builds on existing technology, products or services, through an existing business model, making it easier to do, hence the 70% , and is a good place to start when first testing out your innovation wings.
Breakthrough Innovation - is more at a strategic level and represents about 20% of innovation efforts and comes in two main forms. Either as new technology/product/service/ that relies on an existing business model. Or a new business model that utilizes existing technology/product/service.
Uber is an example of Breakthrough Innovation - they used multiple existing technologies – GPS, Big Data, Mapping technology, but delivered in a significantly different way - via a new business model.
Lastly is Disruptive or Radical Innovation – this is when it transforms an industry – when you rewrite the rules of competition or creates a new market entirely.
Radical innovation is the type of innovation that we would all love to do, but in reality it is the rarest of all and only 10% of innovations fall into this category.
That's because it's not easy, and often involves significant business change and investment.
Netflix vs Blockbuster is a great example of Radical Innovation that we all know. We don’t go to video stores anymore, we can sit in our lounge, and consume what we want, when we want to through Netflix. It even has A.I built in and gives us suggestions based on what we have watched.
I took a photo of my TV the other day when Netflix popped up with ‘Top picks for Trevor’ (my husband) and the Movie was titled 'Loser!'. I wondered what Netflix knew about my husband that I didn't?..... (*Chortle*), but Netflix have certainly rendered their competition obsolete.
So, I get what it is, and what it can look like, but why should I care?
Our lives and our world is changing faster than ever - we are in the age of disruption - and we need to keep up! If your market or your customer needs are changing faster than you are, and you are not anticipating and adapting to keep up with this pace of change, it's only a matter of time before this will have an impact on your business.
Organisations that have a culture of innovation, learn more, anticipate more, collaborate more, adapt more and get more meaningful work done!
A true culture of innovation leads to more meaningful outcomes, for the organisation, it’s teams and it’s customers, because it actively turns learnings and ideas into something real. Innovative cultures are consistently anticipating future needs, solving problems and delivering new and improved products, services and experiences constantly. And this means that people are more engaged in their work because they are delivering more meaningful outcomes.
Human Synergistics in their White Paper on Building a Culture for Innovation looked at data from across 740 Australia and NZ companies which showed that organisations who fostered a culture of innovating had:
28% better teamwork
81% better cross team collaboration
Staff were 60% more motivated and
The organisations were rated at 55% more adaptable to changes in it’s external environment.
Those stats alone should make you care about innovation. Who doesn't want more motivated staff, better collaboration and teamwork, and to be more adaptable??
The good news is - Anyone can innovate, and you can innovate anything - that's the beautiful thing about innovation!
Innovation is not just the job of the IT department, or the Innovation Lab, it is everyone’s responsibility to find opportunities for innovation and to act on them, and if you are a leader in your organisation, you should be encouraging your team to do so.
If you start from the point of 'anyone can innovate', (spoiler alert! - everyone is capable of innovating - if you have a brain, you can innovate), then you just need to get on with it and start!
Here's the recap:
1. Innovation is simply new ideas, that add value, that are made real.
2. Innovation can be Incremental, Breakthrough or Radical. Most Innovation is incremental.
3. Innovative organisations and teams are more engaged, they learn more, anticipate more, collaborate more and get more done!
And anyone and everyone can be more innovative!
Don't know where or how to start? Stay tuned for Part 2: Innovation - where do I even start?!?
Pip Loader works on Leadership and Team Development in the innovation space, helping leaders and their teams build their innovation capability, flex their creative muscles, and teaches new ways to solve persistent problems and challenges facing their business.
Her current program 'Innovation in Action' is designed to help teams get started on their innovation journey. While solving a real problem, teams build their skills and learn new methods and approaches to unlocking deeper insights and connections, and generating fresh thinking that leads to innovation.