Setting Principles for Managing Digital Innovation

Innovation has to become the philosophy, and part of DNA in an organization.

The blurring border of the digital organization and its business ecosystem make the world hyper-connected, but also over-complex. Organizations today can no longer rely on a single individual or team to drive innovation, or still think innovation as a serendipity. Digital is the age of innovation, and innovation is what leads to differentiation. There are many ways to differentiate and, therefore, there are many ways to pursue innovation. But it’s also important to set principles and manage innovation in a structured way across the organizational scope and digital ecosystem.

Dissatisfaction with status quo is the psychology behind creative disruptions: Innovation management shapes bigger box, but the traditional type of management cannot look outside the box. When people get stuck at “we always do things like that” mentality, businesses will run in the mechanical mode; or most of the time, the company executives’ nervousness stems from the fear of failure and to some extent loss of control. But from the long-term perspective, the innovative management make more profit than those that weren't. So leaders need to understand that as they try to desperately cling to the conventional norms of "command and control" leadership that they are actually stifling the very creativity that their company depends upon for success and ultimately corporate survival in the long run. Hence, today’s digital leaders and professionals should learn how to see things differently and do things alternatively. Keep learning and adapt thinking out of the box, make plans, but be dynamic to make an adjustment, and lead innovatively.

Innovation has to become the philosophy, and part of DNA in an organization: To test for how 'creative' or accepting of 'creativity' a company is by asking - How does learning occur? How is success defined? And how is failure defined? However, most of the traditional organizations are “busyness” to focus only on the transactional effort. The challenge is to provide the most desirable environment to spur creativity or to build the culture of innovation. The best way to foster creativity is to help people to communicate in a way that instills confidence, not fear. Creating a culture of creativity is, by nature, a cultural change. Some innovative organizations provide “play time” to encourage creative thinking and experimenting.  As businesses get more cut-throat in the hyper-connected digital environment, innovation has to become the part of DNA in an organization for delivering unique products/services, improving employee engagement and customer satisfaction.

Prioritization provides a framework for focusing on creativity: Creativity can be in the form of an idea, a solution, or an approach. Prioritization is about managing constraints, you can't do everything; so which projects will you do to maximize the business value? Prioritization enables businesses to manage innovation with a focus, not for stifling innovation. Prioritization brings transparency to the organization. Prioritization forces people to be more creative, creating internal competition among new ideas and projects, to come up with better ideas, because now they know that their ideas will be discussed at the board level, and if chosen, they will be followed closely and manage more effectively to achieve business goals. So in company cultures where creativity not always valued, to involve everyone in creativity and to provide a focused approach to real business problems, companies could benefit from a structured approach.

The purpose of Innovation Management is not to promote innovation, but to manage innovation as a process: Innovation Management nowadays is more science than art. Most companies fail at innovation execution because they have no clear processes, nor understand the linkage required to work horizontally across departments, or a holistic approach to managing innovation. Starting with the end in mind - what you want to see or do or have, and then think backward from to what the next simpler step is, then back to what are the next simpler components, back to what you have at hand. In practice, managing innovation as a process involves the bulk of data, methods, and approaches, the complexity of processes encountered speaks in favor of the scientific approach. What defines science from chance is the ability to repeat a process with the same resultant solution every time. Innovation processes need to be rigorous, not too rigid; innovation is the change, change management needs to be an integral part of innovation management.

Innovations succeed when failure is seen as a learning step to great success: Innovation and risk often go hand-in-hand. With creativity, "change" is made." With every "change," the risk is involved. Innovations fail because folks fear innovation. Innovation fails because there are too many disconnects that occur between the birth of a vision/concept and the process of turning it into a reality. The more dramatic and powerful the innovation is, the greater the risk would be. Innovations succeed when failure is seen as a learning step to great success. An overall framework for innovation with periodic reviews will help to sustain progress and minimize the risk of idea flops.

Setting principles and applying disciplines to innovation is to better align innovation management with strategy, to justify the initial investment in the program and the initial results for innovation management and measurement. Digital paradigm shift also includes the perspective of building a scalable innovation environment or innovation ecosystem. It is crucial to set innovation principles, fine-tune innovation processes, capabilities, and develop a set of practices to manage an innovation portfolio more effectively.

Posted in: Digitalization,IT Innovation,Principle/Practice