Innovation is a change, but not all changes are innovation.
With technological advances, businesses large or small have pressure to become more innovative in order to out-beat competition at today’s hyper-competitive business dynamic. But what’s the best scenario to practice innovation management. Does strategy include innovation or is there any additional need for a separate innovation strategy?
It’s situation-driven. A separate innovation strategy which is a sub-component of overall business strategy can be effective 1). If the company does not have Innovation as part of its culture. 2). If the current Innovation Program needs a significant boost, or the intention is to embed innovation in an organization as a new strategic initiative 3). If the company is under threat of becoming extinct due to the competition. But for organizations which have already embraced innovation, then it’s different as innovation is perhaps already a critical, ingredient of strategy, it would be at the heart of everything they do and would run throughout the overall business strategy. But either way, innovation is a key element of business strategy; no matter it’s a separate sub-component of strategy or integrated ingredient of strategy.
On the higher level, the question regarding strategy is often its width or narrowness (‘too wide’ = no strategy, ‘too narrow’ kills innovation). Look at innovation strategy as the stepwise process, by which a firm gains some sort of competitive advantage over other innovative products, processes as the case may be, but for strategy including innovation, it is about how the organization creates new novel ideas or reacts to incidents from competitors. On the operational level, one has to think who is going to contribute to the creation process, and how they are going to do so.
Innovation strategy refers to the creation process: How does the company create. Innovation must be a fluid process inside any organization; therefore, it will be addressed as part of the main overall strategic plan. An "innovation strategy" would encompass a repetitive or iterative process to create. Different innovation (creation) strategies can exist, being top-down, bottom-up, user-oriented, internal, outsource, etc
Innovation is what leads to differentiation. There are many ways to differentiate and, therefore, there are many ways to build innovation into a corporate strategy. Innovation must be included in a strategy; otherwise, the company will fail in the long term. A good strategy will include where the company plans to focus its innovation efforts (product performance, cost-effectiveness, speed, business model, etc...), how this links to the rest of the corporate goals & strategies, and the action plans that must be put in place to achieve the innovation goals.
Put more C-suite people for innovation even when the company performs well, that make innovation more naturally become part of the strategy. Innovation should be embedded in every aspect of the organization, including strategy. So, the innovation-driven organization should not only pursue an innovative strategy but also have an innovation strategy (innovation business model) that holds all innovation initiatives. Even more operational, functional areas should move to a more strategic level if a company pursues sustainable growth. as it is business development. A company really needs to exceed traditional boundaries. A strategy built around some clear value perspectives (such as customer value) automatically provides a basis for innovation & business development.
Not all changes are innovation, but innovation is a change. In this case, embracing innovation is a change, so you need all the pillars of successful change management - a compelling vision and an effective strategy which addresses the following: committed leadership and team of champions, empowering employees, enabling collaboration across all the various functions, creating the right environment (culture), and providing the processes and tools to support innovation.Either an innovative strategy or an innovation strategy, a good strategy takes principles, and practices, with the right metrics, to measure execution performance
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