Digitizing Boardroom: Three Perspectives of Innovation Oversight and Governance

 Innovation governance is to advocate, steer, and sustain innovation.

Every organization is different, every innovation initiative is also unique, there’s no one size fitting all innovation practice, that makes innovation still be serendipitous for many organizations. Therefore, innovation governance is an important perspective to improve the innovation management success rate. Innovation needs a level of guidance, it has to deliver business objectives, it needs the right kind of governance to thrive. Innovation governance is to advocate, steer, and sustain innovation with the following perspectives.

Innovation clarity: Innovation involves new ways of bringing together ideas and resources to create something novel and then transform those novel ideas to achieve the business value. Innovation is doing something better than it currently is. The broader the scope, scale, and impact of the change, the more one leans towards calling such change an innovation. Hence, it requires a sound and competent understanding of what is currently being done, and how to do things better. Innovation leaders should clarify business value by asking: What are the vision and mission of innovation management? What is your strategic advantage? Is your company an innovation leader or a follower? Are you pursuing the market that competes on prices, quality, innovation, services, or other factors? Can you build core business competencies including innovation capability early enough to catch the wave before its crest breaks? Do you have an authentic culture to encourage learning and creativity? Is the organizational structure and management flexible enough to enable innovation? How ambitiously are you for practicing innovation? Innovation cannot be separated from a specific business purpose and in a broad context. The leverage point is to frame innovation and keep focused, but not adding too much complexity.

Innovation variety: The essence of innovation is made of trying new combinations of known things or the variety of thoughts. Digital innovation has a broader spectrum and comes in many flavors, and there are many opportunities in an enterprise to do so, such as breakthrough innovation, evolutionary innovation, incremental innovation, systematic innovation, customer-centric innovation, open innovation, design-driven innovation, or management (leadership, culture, communication) innovation, etc. Therefore, innovation governance should focus on the oversight of a balanced innovation portfolio with well-mixed radical innovation and incremental innovation continuum by taking a set of innovation practices. It is important to set rules for safeguarding the status quo, but not stifling innovation. It’s also important to set the principles for building the heterogeneous group and let people view an idea from different perspectives. With good innovation governance practices, the organization can have a healthy innovation appetite and attitude and take a systematic approach to build a balanced innovation portfolio.

Innovation velocity: Innovation is the most wanted change. The speed of change is expedited, so does the speed of innovation. Companies compete on innovation. Thus, innovation velocity can directly decide the business competency. The innovation velocity depends on the company's position in the marketplace and how fast they can adapt to changes and deliver innovation results regardless of how long they have been in business. With explosive information, the shortened business life cycle, limited resources, and fierce competitions, innovation governance should include how to monitor the pulse of innovation including idea generation, prioritization and risk management. It is common knowledge, that innovation management requires the highest risk-taking at a strategic value chain, including organization, investments, and assets. De-risk the introduction of innovations into the market, protect existing operations and brands and establish clear proofs-of-concept before making investments to launch and scale.

Innovation is a management process and business competency. It requires much more time, energy, passion, courage, experimentation, retreat, and reflection to get clear and focused on the innovative idea, business model, process or solution, and to then enact, embody and execute in a disciplined way. A good governance standard provides a common corporate "language" as well as work instructions. In other words, proper standards, appropriate business and use cases, etc. Innovation governance also needs to set the framework for innovation management, clarify innovation purpose, oversee innovation variety and velocity, steer and sustain innovation to manage risks and maximize its business values.

Posted in: Board Room,GRC,Innovation,IT Innovation