Why Your Innovation Strategy Is (Probably) Failing.

I have a confession to make. 

In my first year of consulting, I would go into client projects with exuberance and optimism. I’d train managers and facilitate sessions that would result in exciting ideas, lofty stretch goals, and bucket-loads of anticipation for what was ahead.

I’d leave energised. My client would leave happy.

And - six months later - nothing would have happened. The strategy we had worked on would have petered out. Innovation was still slowly dragging along. The report and ideas grew dusty on a shelf.

What was wrong?

The innovation strategy we were creating wasn’t a strategy. 

Instead, it was a series of goals with visionary language. It was exciting, well-intentioned - but it was not a strategy.

In the classic Good Strategy, Bad Strategy, Richard Rumelt identifies three concepts of what makes a strategy. When all three of these exist - you have the kernel of a strategy - a plan of focus that allows for change and new advantages.

 

1. Your Innovation Strategy Needs A Diagnosis

 

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The biggest mistake I see in organisational innovation starts here. The leaders of the business fail to face the challenge, and identify the problems that are blocking innovation.

This should be blindingly obvious. If you are seeking to improve innovation - you are recognising that your organisation is not where it should be. But instead of blindly pointing to the future - it is wise to look at the conditions causing you to be where you are.

Otherwise, you’ll be exerting more energy for no reward. The same obstacles will exist - and they will continue to cause frustration and hamper your innovation.

Sometimes these are cultural conditions that need changing. An innovation strategy needs to clearly state these blockers - a fear of change, lack of innovation competency, or a broken workplace culture.

Other times it is business problems - a wildly inefficient production line, a cashflow problem, or a lack of resources.

Your strategy must be brave enough to face and diagnose the problem - so the solution can then be applied.

Note - this is not usually a quick process. All businesses like to hide their issues - and it requires a range of tools and expertise to accurately diagnose the current situation. Rushing over this step will result in frustration in the future.

The end result? A razor-sharp diagnosis that accounts for the complexity - yet has a laser-focus on the critical conditions to be assessed.

 

2. Your Innovation Strategy Needs a Guiding Focus

 

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Although blue-sky thinking can be helpful for ideation sessions - it’s harmful for your innovation strategy. What is needed is a guiding focus - a recognition of what your competitors will likely be doing, what your unique value and offering is, and how you can leverage this to the best of your ability.

This is where most innovation strategies break down. Companies declare that their focus is - “Providing the best value to customers through exceptional service.”Educational providers state they will “Create high-quality, future-job-ready students.”

Great. You’re just describing what all companies and educational institutes do. It’s what your competitors are doing, and it involves nothing unique.

Instead, you need to focus your innovation. Who is it that your competitors are targeting? What can you offer that they will struggle to match? How can you innovate in a way that is difficult to be emulated? What sub-sector of the market can you focus on - and then innovate for their specific needs? What relationships between providers are uniquely valuable - and could be protected through innovation?

According to Rumelt, a great guiding focus will reduce complexity, anticipate competitors, identify points of leverage and create a general coherent action.

Doesn’t sound easy? It isn’t. This takes time, discussions, reflection and critique. But when this is clarified - it creates a consensus of strategy that then can be used to guide resource allocation - and direct the future actions.

 

3. Your Innovation Strategy Needs Clear Actions.

 

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Harvard professor Georges Doriot once quipped, “Without action, the world would still be an idea.”

Most companies are happy if they get their diagnosis and guiding policy done. The report comes through - they’ve done it! They’ve got their strategy - they can show it to anyone who comes in.

But work goes on the same before.

For a strategy to be effective, it must have clear and coherent actions. Not ideas like, “We will innovate more.” “We will be more encouraging.” “We will seek new ideas.”

These aren’t actions, but are fridge-magnet sayings.

A good innovation strategy means you will start doing new things - and stop doing old ones. 

This is always difficult - change isn’t easy, and reallocating resources is tough. But if you are convinced that you need to innovate, you know why you need to innovate, and you have your guiding focus - you will need to change what you are doing.

The actions might state a new training that will happen, with a follow up of a new team to be formed, and a new budget for innovation to be utilised. The action would identify how this budget should be used, intended outcomes - and review points to ensure this is happening.

The action might state a business unit will be shut down. It might state that an old way of working has to change - and these are the steps to changing. 

Regardless - the actions should logically flow from one to the next, and must be actionable. They are not goals or visions - but actions that an outsider to your organisation could read and understand - and see if they are being followed.

 

If you have an innovation strategy - hiding somewhere in your organisation - why not run it through this framework. Does it diagnose the problem? Does it contain a guiding focus? Does it provide clear actions?

If not - perhaps the beginning of 2018 is a good time to think critically about innovation within your organisation - and how you can be shaping a strategy to grow value for your customers.

Get in touch with jeremy@creativate.co.nz to discuss how you can design this for your business.