One of the biggest lessons the pandemic has given us, in my opinion, is that innovation is a non-negotiable function for organizational resilience, especially if an enterprise is to maintain its longevity. However, while the ability to innovate – to introduce new products, services, business models – on a regular, scaled and sustained basis is critical, it is challenging as well.
Excellence in innovation, like other business functions, demands deliberate investment and planning. Innovation calls for management. An Innovation Excellence model, defined by the context and character of an organization, can be an effective tool to help objectively understand the importance of innovation.
Worldwide, the Global Innovation Index is a known metric to measure the ability to innovate. Indeed, there is a science to how innovation is measured. What I outline below are the essential tenets that an enterprise should hope to imbibe in order that it be able to measure its innovativeness.
Investments and Attention – For innovation to be effective, an enterprise’s innovation agenda needs to have a strategic alignment with the larger organizational charter with designated, accountable ownership – either within a centralized, corporate function or decentralized and embedded within business units. Planned budgetary investments, dedicated resource allocation, a differentiated portfolio approach, and executive commitment and oversight are all necessary if an organization is to be consistent and committed to innovation.
Uniform Processes - A robust, well -designed and clearly articulated set of processes is crucial to ensure the smooth functioning and scalability of the innovation engine -- especially in organizations that are large, heterogenous and federated. Some of these processes include lifecycle management, knowledge and risk management, partnership management, trend-spotting, forecasting, and a disciplined governance practice with clearly stated Key Performance Indicators (KPI) to monitor innovation.
Organizational Culture – An enterprise needs the systemic development of a culture of innovation among its people and a best-practice blueprint for this. Breeding such a culture means trying to find the right balance between freedom and focus, risk and return, creativity and contribution, and entrepreneurship and efficacy. This, however, is tricky because in business, innovation cannot be for innovation’s sake. It comes with the necessary burden of having to positively impact business outcomes as often as possible. Deliberate, bottom-up interventions to encourage, share and celebrate free thinking and free thinkers, innovations and innovators, coupled with top-down attention and mentoring can help drive a culture of innovation.
Impact Calibration – Innovation is about creating value through a smart and creative exploitation of internal inventions and ideas and supported by the external ecosystem. Therefore, there needs to be a clear line of sight to the eventual outcomes and impact on delivery across the innovation funnel. These include monitoring and measuring capability creation, intellectual capital, market disruption, customer satisfaction, business performance, brand equity, and society and sustainability through a combination of processes, metrics and tools. Additionally, nurturing a culture of benchmarking innovation in terms of process, performance, culture and capability within and across the industry can be enriching too.
A Recommendation for Enterprise Leaders
As the Innovation Leader of your company, if you have to invest in innovation such that it has a positive and tangible impact on organizational resilience and performance, you do need to institutionalize the right set of practices to manage innovation. Keep a steady and conscious eye on the outcomes, drive the right culture and mindset and above all, remain strategically aligned with your company’s growth charter and priorities.