The Innovation Culture
04 Feb 2008
by Mateen Greenway, EDS FellowAdopting an Innovative Culture to Encourage Creativity and Growth
Innovation is a hot topic. Companies are keen to innovate and be seen as innovative. But why should a company innovate? Innovation is not a thing that can be purchased or installed like a computer system. Rather it is a culture that must be adopted and nurtured. It also needs to have some aim or purpose for the company concerned.
In many ways the 1990s and early 2000s can be seen as an era dominated by corporate cost cutting. The mantra was “if it is not broken, then do not fix it.” This approach was a short-term view and when properly applied, concentrated on reducing waste within an organization.
So, where does information technology (IT) fit? A perception that IT is a cost of doing business rather than something that contributes to the success of a company suggests there is no clear link between IT and business value. This reflects a number of perceptions and problems affecting businesses.
These pressures contribute to the belief that innovation is an organization's best opportunity for survival because innovation extracts value from assets old and new, and revolutionizes industry, society and business. While these pressures can be viewed as articles of faith, there is evidence that innovative companies. (e.g., Yahoo, Amazon, Google, eBay) have been largely successful.
What is Innovation?
Before going any further, it is important to define innovation. Innovation is not about coming up with clever ideas. Creativity is about coming up with the idea. Innovation is about applying the idea to obtain value. To be clear, innovation is the act of changing the established way of doing things, the ability to turn knowledge into value and link emerging technologies with emerging markets. Innovation is about bringing creative new ideas to life.
Within an organization, it is important to understand where and how to apply innovation to create true value. The first question that should be addressed is “What do you want to gain from innovation?” Surprisingly, this identification of a clear goal is often ignored. But without a goal, it is impossible to quantify the value realized from innovation. Some goals for an innovation program include enhancing brand and image and increasing shareholder wealth, return on investment and market share.
While innovation can be targeted, an innovation program should look strategically across all possible solution areas. Any strategy will need to be treated as a journey towards the overall objective. Each step of this journey will involve innovation in some combination of process, product and performance. This innovation will be, by its very nature, dynamic because the overall corporate strategy must deal with changing technology, competition, economic condition, demographic and cultural change and also meet the often complex requirements of governmental legislation.
How Can a Company Innovate?
Having identified where to apply innovation, the next question is how to innovate? The first aspect of this is to determine if your company has an innovative culture? To do this, consider how you stack up against the following six principles of innovation:
- Do you know what business you are in and what are you trying to achieve in the future?
- Do you understand where the value in your company comes from and can you articulate what you want to achieve through innovation?
- Can you concentrate on what you want to achieve or will you be distracted by day to day concerns?
- Can you find a way to complete innovations?
- Can the participants share the results of their innovation?
- Can you get innovation accepted in your company or organization?
Innovative organizations typically display several characteristics including: risk tolerance, focus on the future market, ability to ask why something is done a certain way and then develop a better way to do it if needed, and the understanding that innovation is a culture, not a one-off event.
As companies try to change innovation from an art to a science, the objective is not simply to apply the organization to the task of innovation, but to change the very nature of how the organization innovates. For example, many IT innovations of the last forty years consisted of mechanizing existing processes. Rather than improving the process, the focus was on making the process faster. Today's innovation is about asking whether this is the right process and if necessary, being able to change it entirely.
What Kind of Companies Innovate?
So, who is an innovator? Innovators are easy to describe, but difficult to find. Innovation teams mix together many disciplines and this requires the participation of people who are predisposed to interdisciplinary working. Often these people have degrees and experience in many different subjects, cultures and disciplines and have worked in different specializations.
The director of the innovation team needs to have a high level of skill and credibility within the innovation team and the corporate management chain. It is critical that the director be able to manage a team of highly-gifted, willful and articulate people, be able to speak to business and government agendas, and work with sponsors and stakeholders.
When looking for people to participate in innovation activities, it is vital to remember that innovators are made, not born. Many remarkable individuals contribute to the success of a company, from the design and development of the products to the proliferation of innovative human resources policies and practices. While many of their unique abilities undoubtedly are genetically encoded, it's clear that the company's culture not only makes these individual contributions possible, it must also enhance and nurture them, allowing people to achieve more as a team than they could as individuals.
Fundamentally, Innovation is about changing the behavior of a company from reactive to proactive.
The Innovation Process
Having looked at the how and the who, the next area to understand is the innovation process – essentially the process for the discovery and conversion of ideas to reality. In essence, the process of innovation is a rhythm of search and selection, analysis and synthesis, cycles of divergent thinking followed by convergence. This concept appears in many innovation processes to express design strategy for consumer-centric innovation.
Innovation is increasingly seen as important to gaining and maintaining a business advantage. However, innovation is easy to say, but hard to do right. It requires a significant investment of time, money and resources as well as access to world-class research partners. Achieving this requires a diverse sponsorship base and outstanding staff. Think of it as evolution in action.
About the Author
Mateen Greenway
Mateen Greenway is an EDS Fellow based in London, UK, and is the chief architect for the EDS EMEA Manufacturing industry affinity group. In this role, Greenway is responsible for maintaining and growing a group of highly skilled manufacturing enterprise architecture consultants in support of high-profile bid engagements across the manufacturing industry. Additionally, Greenway leads the EDS Fellows Program activities for Manufacturing clients worldwide.