understanding opportunity and risk

minimising future risk       creating sustainable advantage       creating opportunity

WHY INNOVATION FAILS March, 2010

Heavily involved in business culture change to create sustainable competitive advantage, as we are, three things are evident:

1. innovation is required to stay ahead of the curve, and is widely recognised as being required.

2. the world is changing. The pace of change is increasing. There is a lot of innovation coming on stream - competition is heating up.

3. many, many organisations fall by the wayside and are overtaken because they are unable to harness innovation and so continue with high costs in an eroding market.

This is a sense of frustration to all of us. I mean ... they all admit what is needed and yet ... and yet ... can't quite bring themselves to embrace the culture change required to maintain their organisational effectiveness and customer relevance. And yes, these are organisations who are usually highly silo managed, with a high level of corporate politics and empire retention - therefore risk averse and "business as usual".

This is why innovation fails ... in these companies. And all the time they scratch their heads as they watch their markets decline and their costs increase. Being innovative does not mean needing to be at the leading edge of R&D. You can also be a fast follower - and take advantage of what's already out there ... and adapt.

It's all about awareness and flexibility. If you can't see what's coming along the road, how can you ever expect to avoid a crash? The sad fact is ... some companies actually can see exactly what's coming along the road but continue to drive straight towards it ... and crash. We see it often - and we have to go in and pick up the pieces.

How and why an innovation culture works:

• interaction is a natural state - people will interact. Restrictions on interaction leads to the feeling of being isolated, not listened to, not valued, not being a productive part in the overall organisation
• the greatest level of innovation emerges from areas of high interaction

            - areas of "society" such as cities, workplaces, etc.

            - web (including social media)

• collaboration needs to be focused and an initial framework provided to create the reason to collaborate. The remainder should be unstructured to allow the grass roots free flow of new hotspots of collaborative development (people will find their own reasons to collaborate within a framework, driven by interaction and interest)
• interaction and collaboration enhances and inspires natural intelligence (intelligent working - working smarter, not harder)
• this leads to new ideas relating to areas of specific concern to the environment of the intelligence
• the forward momentum of innovation is created from the groundswell of ideas which often feedback into interaction, either as a means for new interaction or as a source of discussion and opening up of new paths of thought.

This is the feedback mechanism that has driven progression and development for thousands of years. It's how people work. ALL organisations that create and harness an innovation culture make use of this mechanism. ALL organisations who are not innovative or do not have an innovative culture restrict the above mechanism and stop people from working smarter. This latter results in high turn over of staff, high costs and risks of constantly re-inventing the wheel and the noticeably falling behind the commercial leading edge.

This is why innovation fails. It fails because some companies:

- restrict interaction through silo management or high levels of corporate politics and bureaucracy

- this diminishes collaboration

- that dulls the intelligence so people have jobs, not careers, and invariably see themselves working for money rather than for success

- they have very little input into any ideas - because why should they?

- which feeds straight into pure innovation

Likewise, in such situations, even although the world is awash with innovation in all forms and types, people in the above examples of companies will rarely look externally to see what's happening, or to harness the changes taking place.

This is why innovation fails  ... and in our highly dynamic, increasingly competitive world ... why some companies fail - and don't seem to listen what we've said to them. Oh well, I hate to say I told you so, but ...

Regards

JS
 

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The turbulent 21st century

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central@alt3.co.uk