The purpose of Innovation Management is to prepare everything to maximize the transformation of an idea to innovation.
There are both incremental innovation and breakthrough innovation. Breakthrough innovation is disruptive, with high return and high risks. There are many areas within a company where the innovation process can be applied to create value, from product innovation to service innovation, from process innovation to business model innovation, etc. The innovation context goes beyond the traditional scope and extends to the full spectrum including both hard disruptions and soft touches. Innovation breakthroughs that really hit the spot are often the radical new approach that makes a leap of the business to the next level of the growth cycle and achieves the high return on investment. Here are three aims of breakthrough innovation.
Respond to a true human need: With unprecedented convenience that the digital technologies bring to us, business leaders and professionals should ask themselves: Why is innovation so important or even more important whereas technology becomes more advanced? The matter of fact is, the pace of change is significantly increasing, innovation is the only path and the core activity of human evolution to changing of the environment for unlocking business performance, for profit, for resource optimization, and for customer satisfaction, etc. The breakthrough innovation has to respond to the true human need. The speed of change is expedited, so does the speed of innovation. Innovation is not an invention, it must prove its value in the market. Customers must be willing to pay for it, be it a products/processes/ services innovation. Thus, people must be the center of innovation. Innovation is both art and science. To manage innovation and control risks systematically, the scientific processes should be in place, and the science of innovation can be understood via “retrosynthesis process” - start at the products, with what you want to see, do, or have. Then, think backward from there to what the next simpler step is, and then back to what are the next simpler components, and back to what you have on hand. Thus, customers should always be involved, it is not a question of whether the customer is right or not, it is more of whether you are truly and proactively listening to their needs and gaining a deep understanding of the customer through empathy. Responding to the true human need is the very goal of doing innovation. When managing the innovation life cycle, customer involvement at all stages often elicits highly valuable information.
Ride on emerging trends to figure out the better way to do things: Nowadays, often technologies are the disruptive force behind digital innovation. The highly innovative organizations depend more heavily on its technological knowledge and market capabilities to develop and commercialize innovation. Innovation is the differentiated business capability enabling the business to ride on emerging trends and beat down competition effortlessly. From an entrepreneurial perspective, innovation is the essence of new and independent companies that act as the agents of changes in either emergent or traditional industries. The essence of innovation is made of trying the new combination of known things to create new stuff and figure out the better way to do things. By introducing new products or new methods of production, by opening new markets or utilizing new resources, by leveraging digital variety for brainstorming and gaining new ideas, the highly innovative organizations can seize precious business opportunities and innovate.
Innovating business models to rejuvenate organizations: A business model is a description of the way in which an enterprise intends to make the profit. Businesses can explore the concept of a business model by addressing some core questions such as, who are your target customers? What need is met for the customer? What offers will you provide to address that need? How does the customer gain access to that offering? Which role will your business play in providing the offering? Etc. The business model is an entire frame of elements that describe the intents and constraints of a business or an organization. Business model innovation is often breakthrough because if an established firm identifies a new business value proposition that requires a change in the business model or the creation of a new one, and then, it’s strategically important to develop the new venture for improving organizational growth and profitability depending on the company’s competitive environment, their impact perhaps increase over time. In fact, with the hyper-competition we live in, no competitive advantage is set forever. So, any operational advantage in creating value is likely to be copied fast. To avoid this fast obsolescence, besides focus on execution or incremental improvement, the business model needs to allow space for innovation.
The purpose of Innovation Management is to prepare everything to maximize the transformation of an idea to innovation. The goals of innovation, especially breakthrough innovation, should focus on people and the long-term trends and business vision. All humans are naturally creative. Create and nurture an environment in your organization where humility is appreciated, curiosity is encouraged, and creative thinking is rewarded.
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