Tuesday, April 8, 2014

The 1001th Story: Five Barriers to Innovation Success

This is the 1001th 'Story' of this Blog, but innovation is a never-ending story.

Innovation is a never-ending story, the subject which is worth brainstorming in this matter at the 1001th blog is innovation barriers, which are faced by innovators during their attempt to successfully launch an innovation, there are five main barriers:

Marketing barrier, or the barrier for reaching the customers effectively: Defining the 'WHY' you are innovating (revenue growth, improve market penetration, target a new market, optimize a process etc.) is the first difficult step and the most important one. This sounds simple, but you will find that it is quite challenging to do so. If you want to innovate and differentiate yourself from the competition, your first and most difficult step is to define the situation in the industry, segment, or category that you want to challenge at a bird's eye level. What do you want to disrupt? What can you invert? What can you deny? What can you scale? The ability to ask "what if?" or "what's next?" is the toughest part at the front end of innovation. There is a danger of a disconnect from the whole. Innovation is about solving problems for customers, identifying the shape, size, and emotion of customer needs and opportunity gaps, or simply empathizing with customers (solving a problem, a challenge or a need that they may not be able to articulate, a problem that they may not think can be solved). Spotting needs and opportunities require you to think about your industry and competition in new ways. You need empathy, observational and interpretive skills, a driving desire to delight customers. If your company can't overcome this initial idea generation challenge -the biggest challenge during the fuzzy front end of innovation, you'll simply reconfirm your existing competitive strategy. You'll generate ideas that are focused on the wrong insights.

Financial barrier: The barrier of getting buy-in from investors or shareholder in order to start up the innovation successfully is the other big challenge. This part is difficult because it should be unique and sufficiently convincing for each stakeholder so they would buy in. This part can be more difficult when the corporate strategy deployment is not in place or is not communicated well within the organization. But the difficulties can be alleviated by asking some hard questions early on: Do the potential outcomes of the idea create value. If the answer is yes, then the recipients of the potential created value must be identifiable, meaning you can seek their opinion. If you can’t get early adopters to buy in, then the idea may not be worthy of pursuit. Create clear systems for approving/funding ideas. There are both strategic level and operational level clarification for overcoming such barriers: a) definition of innovation strategy and to ensure everyone is aware of the innovation direction, often the "guideline" is missing: where are we and in which direction do we want to innovate? Lack of trend management often leads to running behind short term hypes; b) on an operational management level: take calculated risk, no risk, no innovation, this mentality is hard to implement. But keep in mind that the purpose of innovation is to improve current business and achieve its long-term prosperity.

Culture Barrier: If you can get buy-in, then make an identification of the technical and cultural barriers, and how these may be overcome becomes the follow-up phase. The culture barrier is faced when confronted with no cooperation from colleagues and management, or when the culture within the company is very internally focused, the fuzzy front end is being some time before the innovation process starts. Further, the reality in companies is often a missing culture & spirit of cross-functional thinking and an existing silo mentality, missing "willingness to share knowledge" is a barrier to innovation. And the key challenge with innovation is creating a workplace environment where everyone can feel confident about sharing their ideas without fear of being criticized, damaging their reputation or looking like a fool. Want to create a culture of innovation? Recognize that your people are as important as the process. Hire innovative people. Build diverse teams. Redesign your employee review process to include innovation criteria. Encourage, recognize, and reward employee engagement and good ideas. Every employee should be an innovation champion -stay hungry, stay foolish.

Information barrier: Many times, an innovator is less able to communicate effectively with their stakeholders because of a lack of the right information at the right time. This could be customer related information, governmental/ regulatory information, information/knowledge about competitors, supplier information, macro economic developments etc. Information is the lifeblood of any digital business today, and knowledge is power to make a decision upon innovation. There is a correlation between innovation management and knowledge management (identifying knowledge gaps, acquisition, application, and assimilation). An innovative business must also be an information-based learning organization. The key to the learning organization lies in the ability and willingness of people to innovate. The speed and effectiveness with which new practice and innovation can spread throughout the organization are crucial. Ulrich has suggested that the organizational learning capability can be expressed as OLC = I + G Where:
OLC = Organizational Learning Capability.
I = ability to innovate.
G = ability to generalize this learning into good practice throughout the

Process Barrier: It’s a holistic innovation process...like growing a plant....the seed and germination are the front ends, but you must be ever cognizant of the rest of the growth of your idea and not just worry about the seeds. Thus, the start of the innovation process is also the key and needs to be structured accordingly. The rest of the development process is just as critical as well as the underlying culture. However, the processes should not be too rigid or ‘over-done’, otherwise, Innovators get mired in the muck, only focusing on the process. The reason why sometimes innovation misses its promise is because innovation "experts" focus too much on parameters, attributes, frameworks, and specifications of outcomes, or what can be statistically proven or accurately measured, with ignorance of the ultimate purpose of innovation. The organizations have to well align people, process, and technology in managing innovation effectively. Being able to innovate depends upon the quality of the people and how good they are at learning and development. Generalizing good ideas quickly throughout the organization depends on the effectiveness of communications systems, the people to share and exchange ideas, as well as the processes to implement idea systematically.

Innovation is the journey with many barriers on the road, as in today's digital world, the organizations are dealing with a combination of factors (social, economic, environmental) which can be described as "messy". Balancing these variables is difficult and what you will find is that the decision-making process involves breaking this "mess" into a number of problems, and then solving a problem as an innovation puzzle. Therefore, outside-in customer centricity, the culture of learning, information abundance, process agility and creative human capital are all key success factors in overcoming these barriers and ensure innovation success.


Post a Comment