Saturday, October 6, 2012   By Dr.Rajesh Patel   1
Why is innovation necessary?Western businesses can no longer guarantee to compete on a world stage on pricealone. The cost...
Saturday, October 6, 2012   By Dr.Rajesh Patel   3
A legacy of innovationIn the UK we have historically been great at coming up withideas, but not so great at exploiting the...
Innovation and Planning  As with all other core business processesinnovation needs to be linked to strategy and thebusines...
The InnovationPipeline  Once innovation, as aconcept, as been acceptedat a strategic level; thepractical       implication...
Innovations and ideas can come from any part of anorganisation. It is not the preserve of the R&Ddepartment or Marketing. ...
A successful innovation culture embraces all aspects of a businessand should be managed as effectively and efficiently as ...
Ideas should be effectively screened and ‘bad’ ideas killed off quickly butsympathetically. The number and type of ideas w...
proponents of the idea or innovation will have to estimate or calculate the specificbenefits that will arise. Suitable – ...
Saturday, October 6, 2012   By Dr.Rajesh Patel   11
The Innovation Process Innovation should be built intobusiness routines at three distinct levels – at the AnnualBusiness P...
There are a few critical success factors when installing andrunning an innovation process within any organisation: A focu...
Saturday, October 6, 2012   By Dr.Rajesh Patel   14
The Innovation PlatformLike all other core processes, innovation is best managed throughsome sort of platform or applicati...
Innovation and People Research has indicated that one of the most important factors in installing aninnovation culture wit...
Innovation and PerformanceFinally, like any other corediscipline, creating an innovationprocess      and    installing  an...
The IntegratedInnovationFramework  If innovation, therefore, is a corebusiness process and discipline vitalto the success ...
Saturday, October 6, 2012   By Dr.Rajesh Patel   19
In the 21st century, in a global economy, thereshould be a Chief Innovation Officer or Director ofIdeas who should lead an...
Saturday, October 6, 2012   By Dr.Rajesh Patel   21
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An integrated approach to managing innovation

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An integrated approach to managing innovation

  1. 1. Saturday, October 6, 2012 By Dr.Rajesh Patel 1
  2. 2. Why is innovation necessary?Western businesses can no longer guarantee to compete on a world stage on pricealone. The costs of doing business, especially in a manufacturing sector, are far greaterthan those in Eastern Europe and in the Far East. In terms of economies of scale, whichfor decades was a differentiating factor for many businesses, the BRIC nations (Brazil,Russia, India, China) possess internal markets far greater than the UK. The loweringcosts of transportation and better communication mean that these nations can move intoour market places with increased ease. “If you can’t compete on price you have todifferentiate, and to differentiate you have toinnovate!” Saturday, October 6, 2012 By Dr.Rajesh Patel 2
  3. 3. Saturday, October 6, 2012 By Dr.Rajesh Patel 3
  4. 4. A legacy of innovationIn the UK we have historically been great at coming up withideas, but not so great at exploiting them! This has almostbecome a truism where businessmen talk wistfully aboutopportunities missed! Despite the wealth of scientific andmanagement expertise in this country we are lagging furtherand further behind other nations in the innovation stakes. Wehave an economy and tax structure which is broadlyencouraging of new companies and businesses yet we are notmaking the most of our opportunities. Saturday, October 6, 2012 By Dr.Rajesh Patel 4
  5. 5. Innovation and Planning As with all other core business processesinnovation needs to be linked to strategy and thebusiness planning process. Innovation separate tobusiness strategy runs the risk of diverting keyresources and damaging the focus of anorganisation. This ‘missile looking for a target’syndrome must be avoided at all costs. Innovationactivities MUST be driven by strategy and currentbusiness imperatives. Saturday, October 6, 2012 By Dr.Rajesh Patel 5
  6. 6. The InnovationPipeline Once innovation, as aconcept, as been acceptedat a strategic level; thepractical implications ofhaving an integratedinnovation process orsystem have to beaddressed. An effectivestarting point is tounderstand from whereinnovations originate andhow they can be collatedand screened. 6, 2012 Saturday, October By Dr.Rajesh Patel 6Innovations
  7. 7. Innovations and ideas can come from any part of anorganisation. It is not the preserve of the R&Ddepartment or Marketing. Nor is it merely limited toan employee or customer ‘suggestion scheme’. Thegreen cells represent sources internal to theorganisation, blue external and red via third parties.The sources of innovation are many and varied butthey need to be collated, coordinated and managedas a source of valuable information and are core tothe future of an innovative business. Saturday, October 6, 2012 By Dr.Rajesh Patel 7
  8. 8. A successful innovation culture embraces all aspects of a businessand should be managed as effectively and efficiently as any othercore business process. To that end, successful innovation companiesoperate an ‘Innovation Hub’ where all ideas and innovations arecollated and coordinated. Creative processes and analysis can beused to stimulate new ideas in four basic areas: Business Innovation – new business or supply chain models, forexample Product or service Innovation – new or modified products orways of providing a service Market Innovation – opening a new market or creating a newcustomer base Process Innovation – improving or changing internal processes Saturday, October 6, 2012 By Dr.Rajesh Patel 8
  9. 9. Ideas should be effectively screened and ‘bad’ ideas killed off quickly butsympathetically. The number and type of ideas will be determined by the‘performance gap’ and available resources. Many organisations find that an effectivescreening or filtering process prevents ‘innovation overload’ whereby a company isalmost paralysed by the sheer volume of innovations and ideas generated from themultiplicity of sources previously mentioned. If new ideas and innovations are to makea difference, they must satisfy five basic criteria captured in the V-SAFETM screeningprocess: Value – does the idea deliver tangible benefits to the organisation? This questionshelps eliminate those ideas and innovations that are good in principle but add little orno value to the bottom line, now or in the future. ‘Tangible’ means that Saturday, October 6, 2012 By Dr.Rajesh Patel 9
  10. 10. proponents of the idea or innovation will have to estimate or calculate the specificbenefits that will arise. Suitable – is it consistent with strategy and the current situation? This helps eliminatethose ideas that are potential distractions and move the business needlessly away fromits core business focus. If an idea or innovation is not ‘suitable’ it still may have value,but in other ways – such as outsourcing it under licence to third parties or even spinningit off as a separate product within a separate business entity! Acceptable – will all stakeholders support it? Often innovations fail in large companiesbecause of the ‘not invented here’ syndrome. It is crucial that proponents of an idea orinnovation spend time and effort on selling the idea internally and gauging the level ofsupport for it. This is often overlooked and failures are often attributed to ‘office politics’.Stakeholders are an internal barrier that must be negotiated as if they were a formalprocess. Feasible – are there sufficient resources and time? Can the innovation be managedwithin existing budgets or will additional funding be required? Do new skills need to beacquired to implement this idea effectively? The answers to these questions will affectthe timeline for implementation and the potential return on investment calculation. It isoften seen as a reality check. Enduring – will the idea deliver value in both the long and short term? If a new idea orinnovation is to be truly strategic will it survive the rigours of time? Is the long term gainworth the short term pain of bringing a new idea to market? Again this highlights thereturn on the investment to be made. Saturday, October 6, 2012 By Dr.Rajesh Patel 10
  11. 11. Saturday, October 6, 2012 By Dr.Rajesh Patel 11
  12. 12. The Innovation Process Innovation should be built intobusiness routines at three distinct levels – at the AnnualBusiness Planning (ABP) process, through structured ‘themed’Quarterly Innovation Workshops (QIWs), and ad hoc day to dayactivities. Some of the routines are ‘proactive’ by nature – aconscious focus on bringing ideas and concepts forward into theinnovation process – such as ABP meetings and QIWs. Someroutines are ‘passive’ or ‘reactive’, such as creating a culture ofinnovation where day to day activities and management seek toenable innovations to flourish. In all cases ideas andinnovations should be driven by market, customer or competitorinsights (MCIs) and progress reviewed on a monthly basis. Arobust project management process is often a prerequisite foreffective implementation and communication. Saturday, October 6, 2012 By Dr.Rajesh Patel 12
  13. 13. There are a few critical success factors when installing andrunning an innovation process within any organisation: A focus on opportunities of high value – and lesser ideas are discarded quickly.This is done through a robust and widely known filtering process using the V-SAFEprocess, or similar. Active commitment of top management – through visible leadership and use of theprocess by senior management. As soon as an ‘informal’ process to fast track ideasfrom senior management is used the innovation process breaks down. Build techniques into business processes – the most successful innovationcultures are those where the core innovation process is as natural as all other businessprocesses such as budgeting and planning. Easy to state – difficult to do! Develop innovation as a core skill – in all staff and especially in managers! It can bedone and managers can be encouraged to put forward their and their staff’s ideas.Thinking innovatively is a skill that can be acquired. Tools to support the application of concepts – using the internet and sometracking software ideas can be tracked and innovations planned. You would not think ofrunning any other core business process without a tool or system of some sort – so whyshould innovation be different? Reward people for sharing ideas & knowledge – and this does not just mean acash bonus! Performance can be improved through good management and a rewardsystem that recognises group effort and sharing ideas rather than just the individual. Saturday, October 6, 2012 By Dr.Rajesh Patel 13
  14. 14. Saturday, October 6, 2012 By Dr.Rajesh Patel 14
  15. 15. The Innovation PlatformLike all other core processes, innovation is best managed throughsome sort of platform or application. A web-based tool should beavailable anywhere, anytime and should be quick and easy to use.Innovation tools can be thought of as two distinct types; anelectronic suggestion scheme (ideas tracker) and a managementsystem controlling the overall innovation process – from ‘ideas toimplementation’. Any innovation management system must givesenior management visibility and control over the innovationprocess and confidence that best practice tools and techniquesare being used appropriately and applied consistently across theorganisation. Any platform should facilitate effective crossfunctional learning as a core feature. Saturday, October 6, 2012 By Dr.Rajesh Patel 15
  16. 16. Innovation and People Research has indicated that one of the most important factors in installing aninnovation culture within any company is having leaders and teams with abilityand commitment. Senior managers need to understand the strategic direction andhow innovation can help. They also need to be able to motivate others. Creating aculture of continuous innovation requires leadership and commitment from theBoard and senior management teams (SMTs). This is a ‘must’ – a necessaryprerequisite for success. It also requires agents of innovation and innovation teamsacross the organisation, champions who will assist a project manager with theimplementation and tracking of ideas, innovations and changes. Managers need toconstantly look at their part of the business and ask themselves “what are thebarriers to being innovative and creative?” They need to ask themselves and othersquestions, such as: Is anybody being asked about their ideas? Do staff know about the need for ideas and innovation? Are people rewarded for their ideas and contributions? Saturday, October 6, 2012 By Dr.Rajesh Patel 16
  17. 17. Innovation and PerformanceFinally, like any other corediscipline, creating an innovationprocess and installing aninnovation culture must bemanaged and measured on anongoing basis. Monthly andweekly meetings should focus onthe progress and performance ofboth new ideas and theimplementation projects. Issuesshould have a process by whichthey are escalated and associatedrisks managed where appropriate.The performance of the innovationprocess and the issues raisedshould drive and inform the nextplanning process and review ofstrategy. Performance has to belinked to strategy and measuresand key performance indicators(KPIs) set. October 6, 2012 Saturday, By Dr.Rajesh Patel 17The
  18. 18. The IntegratedInnovationFramework If innovation, therefore, is a corebusiness process and discipline vitalto the success and growth ofbusinesses and organisations in the21st century, companies should adoptan integrated approach to managinginnovation. The alternative is apiecemeal approach which has lesschance of generating the returnsexpected and required by business. Saturday, October 6, 2012 By Dr.Rajesh Patel 18
  19. 19. Saturday, October 6, 2012 By Dr.Rajesh Patel 19
  20. 20. In the 21st century, in a global economy, thereshould be a Chief Innovation Officer or Director ofIdeas who should lead and manage the innovationsprocess within a business. For large organisationsthis would be an indicator of whether a business istruly innovative and has taken an innovationculture.Saturday, October 6, 2012 By Dr.Rajesh Patel 20
  21. 21. Saturday, October 6, 2012 By Dr.Rajesh Patel 21

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