Scaling innovation for better outcomes
A cost-sensitive, yet risk-embracing industry tends to look at duplicating innovation to scale it. But future-looking healthcare companies that have understood the basic structure of innovation, have transformed themselves into wellness companies. A few of them have become ‘analytics’ organizations. From Henry Ford’s automobile assembly line to the recent unicorns born out of that one smart idea, innovation made space to take ideas and concepts that extra mile. As these healthcare organizations grow with independent federated portfolios, the future of innovation is clear. It is imperative for all the stakeholders to explore ways to scale innovation for bigger and better outcomes.
As the definition of innovation is multi-dimensional and familiar, let’s take a critical approach and define what it is not.
Innovation is not -
This paper digs deeper into the core elements of innovation, discusses some myths that typical organizations follow to scale innovation that cause them to fall into a measurement trap.
The core elements of innovation
Innovation can be a blend of great ideas that can rebuild and strengthen an organization. Some of those elements include:
Innovative vision and culture—the direction in which the organization is heading and the approach it takes to reach its objectives
The ‘scaling’ debate
The most adopted model for scaling, templatization works well to duplicate the structure of a use case but fails when it comes to replicating the original idea. While templates can act as vehicles, the goods to be ferried come from individuals with unique thoughts.
When Ford invented the assembly lines in 1913 for mass production, it became a ground-breaking innovation of that time. However, if the same process is repeated, putting together an ‘automobile assembly line’, which reduced the time taken to build a car drastically from 12 hours to about 1 hour 33 minutes, is no more an ‘innovation’. It became the new normal or to put it simply, trivial. So, replicating success might assure mere incremental gains, but might fail on the disruptiveness scale of the innovative dimension.
Sometimes, the line between innovators and ‘early adopters’ is so thin that the early adopters reap better benefits than the innovators themselves. The key to succeeding is to understand that innovation is a journey and not a destination.
From this debate on how to scale innovation, the real questions that come up are:
‘Scaling’ in the context of healthcare innovation
Scaling in a cohesive and interconnected industry like healthcare requires partnerships with third parties that offer niche services. These include specialized care providers who offer high-quality services, anytime, anywhere, and at affordable costs, and companies that devise integrated care models, offer wellness as a service, and design platforms that deliver unique experience to patients, and so on, especially when organizations do not possess that niche capability themselves.
Being a part of the problem also inhibits the individuals’ ability to devise a solution within the confines of the same space or ecosystem. It might be a good practice to share an industry-specific problem with a larger audience from a different domain, thus encouraging people to think of an ‘out of the box’ solution. This is an equally innovative approach where a healthcare industry problem might be resolved by someone from the retail or banking domain.
To scale innovation in its true spirit, it is essential to explore and implement the fundamental building blocks of innovation.
1. Form focus teams for innovation
2. Develop a mechanism to listen to the end user through multiple channels - Focus on pain points
3. Conduct a lateral thinking session on the problem statement for a fixed time - Find the rhythm or pattern in chaos
4. Give way to crisp prototyping models
5. Refine solution with continual feedback before handing over to the delivery teams
6. Develop innovation as a cultural change, shifting focus -
To measure or not to measure?
Executives need to understand the impact of the time and cost invested in innovation on their outcomes. Also, if research and development dollars will help build new products, and when these new products will achieve higher gross margins. In addition, they would want to provide strategic direction by signaling shifts in priorities, guide resource (re)allocations, and assess effectiveness of innovation spending to diagnose and improve innovation performance. In a nutshell, executives must look at the futuristic value of their organization and its products with an investment in innovation today.
While the portfolio measures look at business impact through revenue, market share, funding, customer loyalty, and lifetime value, it is also necessary to measure organizational impact on employee engagement, capability maturity, and reputation.
However, there is also the ‘measurement trap’ that organizations need to avoid. Metrics place more emphasis on the outcomes over process effectiveness. Organizations may tend to measure what is available because some of the performance metrics will lag by a year or two. And sometimes, the metrics-based measurements incentivize incremental innovation over disruptive ones. While innovation can be incrementally delivered, the measurement trap carries the risk of steering the organization away from disruptive thought processes which will eventually normalize the innovation model that once delivered success in one specific area. To avoid these traps, organizations need to define what success looks like and how it ties into the future vision for the organization and the innovation’s contribution.
In short, the futuristic measurement framework for innovation starts with understanding the building blocks of innovation first and configuring a special set of measurements to evaluate the effectiveness of each block. Some steps rely on traditional measurement methods like:
Some innovators take a strong ‘anti-thesis’ path to measure failures:
Scaling of innovation calls for a simple yet pragmatic approach toward expanding outcome-based models in domains like healthcare. Every organization has an in-built culture of innovation that needs to be used to its full potential, to derive best results. Results from more implementations are necessary to correlate and perfect these models and in time, might evolve into a full recipe of setting up a framework to scale innovation.
Breaking down the specific definition of innovation for a given portfolio is necessary and needs an ecosystem to be created within the portfolio to promote an innovation culture. Insistence of the first-time right approach might not provide the best results. Hence, we should aim to fail fast and maintain outcomes to not fall into a ‘measurement trap’, where we tend to quantify results faster, instead of measuring their quality.
The author of this white paper would like to acknowledge the invaluable contribution of Sundara Rajan Subramanian (Delivery Manager) and Sakthi Vinodhini Muruganantham (Managing Partner) and thank them for their fresh perspectives and insights.