September 26, 2005
Part II - Innovation in Today's Business Environment
Gaining Consensus and Commitment on the Scope of Your Innovative Effort
by Al Groover
It is generally accepted that knowing where you want to go ensures a shorter trip to your destination. As discussed previously – in today’s business environment, all companies must seek to be innovative. However, striving for innovation can mean a great deal of different things to different people. And, once you know how you will attempt innovation, the final definition is largely dependent on one of three values – time, money and the desired level of innovation.
What Are The Different Levels of Innovation?
 There are three generally recognized levels of innovation. The first is basic process improvement that delivers baseline growth. This level focuses on doing the same things in an improved way. The second level is generally referred to as “revolutionary”, or doing the same things in a very different way. This second level normally drives accelerated growth, but relies upon existing processes and technology that is perhaps used in a different way. The third, and final level, is transformational change. Transformational change completely modifies the way something is done or even what is “to be” done. The top tier innovation generally is most risky; but, if successful, delivers breakthrough growth.
If You Don’t Know Where You Are Going, Will You Get There? How Will You Know?
So to which level of innovation do you aspire? While the top “transformational” tier is the most ambitious, the reality is that the majority of all innovation activities fall into the first tier. So, which is the correct tier for you? Your business need dictates the answer that question. If you need to drive breakthrough growth, then your focus should be on doing things in a totally different way. The old adage “you can’t continue to do the same things and expect different results” rings true. The important aspect is that you understand what level are you working and control your scope to stay in the appropriate range. Letting your business need dictate your scope will always be a sound strategy to follow.
When time is a defining factor in scope definition, businesses generally look at three different projections – this year, next year or longer. A year in this sense is often defined by business plans. Are you going to affect this year’s plan, next year’s or even longer term? Often the funding for innovation projects is awarded by the potential impact on the revenue side. In addition, one should always consider the timing of the benefits of any innovative proposal. As one would expect, the monetary level of investment greatly varies with the size of the business and its appetite for investing and strategic direction set for the company. As with all investing, greater risk drives a need for a higher potential return on investment as justification.
Is There a Difference in Generating and Evaluating an Idea?
The short answer is yes. The goals and parameters for establishing ideas and the evaluation processes should be different. When generating ideas, one of the biggest challenges facing facilitators is in getting participants to “think outside of the box” and letting go of the rules that come into play during their everyday business lives. Typically, the appropriate place for the normal business filters such as “it cost too much” or that’s not the “way we do things” is appropriate for the evaluation of ideas.
Having creative participants understanding that the goal for the creative process is to generate a large quantity of ideas will encourage and empower the contributors, leading to better creative results. Evaluation of ideas can often be completed by a different group which would apply the qualitative filters to decision and determine the feasibility of integration of the idea into current or future business processes. In the future, count how many times you hear the conjunction “but” in meetings. Know that when you do, a filter is being applied. Ask yourself: Is it an appropriate time for filters? If you’re trying to generate ideas, the answer is no.
When Do You Involve Different Stakeholders?
Once you have determined your appropriate scope for innovation, the next consideration is to secure the appropriate level of sponsorship. As a guiding principle, the higher the level of innovation you are seeking, the sooner you should engage and solidify support from your stakeholders. When you are contemplating transformational change, remember that you are impacting the company’s strategic direction and therefore your stakeholders should be highly engaged at the earliest opportunity for proactive consideration (meaning idea generation). In attempting to drive breakthrough growth, your innovation must complement the long term strategic direction for the business.
In recap, understanding and defining three components – timing, monetary requirements and level of innovation desired – will create an innovative project’s scope. Doing so, will be set a foundation upon which successful project can be delivered. Remember, it’s just the beginning; next month’s article will explore the critical steps for the creation of a solid measurement plan - an equally critical part of overall project success.
Cheers!
Al Groover, business consultant, joined the Brickstream® October, 2004. Prior to joining Brickstream, Al spent over 20 years in strategic and innovation project delivery for major American corporations. Most recently, he served as senior vice president and design manager for Bank of America’s Innovation and Development Center. His current role at Brickstream focuses on working with retail and banking clients in leveraging the data generated by BehaviorIQ™ to drive change within these organizations.
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