How to bet on innovation — and win
Three thousand to four may not be the kind of odds you’d like to place money on, but for companies today, that ratio can determine survival. Three thousand is, in The Economist’s telling, the number of ideas it takes for a business to reach four development projects – only one of which may ultimately be valuable to the company.
In the current business climate, innovation is ever more necessary for businesses to differentiate themselves. From Slack offering new ways for employees to communicate to Schick offering razors that pivot on a ball, product leadership is becoming a requirement for success. The key to effective business leadership is to create a culture where the 3,000 ideas can surface, and then, more challengingly, where the four best ideas can bubble to the top, leaving you with the one innovation that can push your company toward success.
A few years ago, one of my Fortune 100 clients asked me to develop a model of innovation for their company. As I dove into the research, I identified three essential processes for creating a truly innovative product or service. The creative brainstorming phase kicks off innovation. We sometimes mistakenly think this is what innovation is all about, but it’s just the beginning. Once an idea is surfaced, it moves to the screening and testing phase, where it’s subjected to a rigorous process of evaluation. If it passes, it moves onto the third process, internal selling, where it’s put in front of the decision-makers who can turn it into reality. A company only has an innovative product or service after all three processes are complete.
The challenge is that each of these phases requires a different kind of leadership. The executive who can lead a team of free-wheeling “creatives” is a different cat from one who can spearhead a rigorous testing process. And the leader with organizational savvy who can influence folks at the top must have a different style and skill set from either of the other two.
To be truly innovative, an organization has to balance playful openness with tough standards. The leaders must create a safety zone where individuals, even those who are not part of the official innovation team, feel encouraged to bring forward their ideas. If I am afraid I will be ignored or mocked for making a suggestion, I will keep my best ideas to myself.
Once the ideas are collected, a fair, transparent way to sift out the best ones is required. An innovative organization is honest about which projects aren’t going anywhere and has the will to kill them off. And it must create a culture that delivers negative feedback in a way that still encourages people to keep bringing more ideas forward.
My client used this model to create new structures for each stage of the innovation process. New technological tools were developed to facilitate the sharing of innovative ideas from the bottom up. Employees were encouraged to “pitch” their ideas to teams of leaders. Extensive consumer research was used to identify the most promising ideas. Internal champions influenced the top executives to invest in some of the innovations. The result – penetration of new customer markets and increased revenue.Building and sustaining an innovative company is exciting and challenging.
For more ideas on how to win through innovation, let’s talk.
