Wednesday, October 31, 2018

Three Insight of Digital Innovation

Innovation is what leads to differentiation. There are many ways to differentiate and, therefore, there are many ways to pursue innovation.

The digital era upon us is the age of innovation. The unprecedented digital convenience brought by the abundance of information and powerful technologies changes the way we think, live, and work. From a business management perspective, innovation - the practical application of creativity is essentially about problem-solving at various levels, and to solve a problem implies a wish to make something, or everything better. Innovation is the managed process which can be classified scientifically and managed dynamically. Here are three insights into digital innovation.

Innovation, in general, is surely a cross-science and art discipline: Innovation is not serendipity, but a systematic process to transform novel ideas and achieve their business values. Digital innovation has a broader spectrum and enriched context. At an enterprise level, digital innovation management requires cross-functional collaboration and interdisciplinary knowledge sharing. It covers information management, knowledge, technology transfer, design, entrepreneurship and it is closely related to several other disciplines such as the economy, psychology, sociology, and law, not speaking about disciplines that are related to technologies implemented by the particular innovation. With “VUCA” digital new normal, the bulk of information, methodologies, and approaches involved as well as the complexity of processes encountered speaks in favor of the scientific approach and engineering practices for innovation management. If creativity is more art than science. Theoretical treatment of the innovation discipline may give rise to a science -in a sense innovation would be a "cross-science” discipline. To bridge the innovation skill gaps, it involves training for each group in areas where they are weak - teaching engineers how to build the financial case for a new product. Shared goals should also be reinforced by shared KPIs so that each culture is incentivized to think beyond their silo. For example, when coming up with new innovations, engineers should not only be responsible for technical performance but also should have the business acumen for ensuring that their ideas can be made and that they will be profitable for the company.

People-centric innovation is the digital theme: In practice, people-centric innovation means that you have to involve customers and different stakeholders, listen to their feedback, involve them in both idea generation and process implementation. To put simply, people should be the center of innovation management and they are the major focus for innovation process and accomplishment. One of the key determinants of whether an organization can move to the digital new normal is how well it can delight customers and the digital maturity of its people. Innovation happens at the intersection point of people and technology. Thus, the innovation capability of the business is built through the alignment of people, process, and technology. Digital organizations are flatter and information-driven; with an “every individual as a stakeholder” culture, people are encouraged to think differently and do things differently. Thus, people-centricity should be another critical component in the digital innovation playbook. It is about how to engage and empower customers for innovating; people over tools, to gain insight and empathy, to take different propositions and approaches to a problem or a new interpretation, empowering and enabling over control, with the goal to build a high-innovative and high mature digital organization.

Innovations succeed when failure is seen as a learning step to great success: Innovation comes with a risk of failure, usually not well tolerated in a market governed by risk-allergic mindset. The more dramatic and powerful the innovation is, the greater the risk would be. Innovation and risk often go hand-in-hand. At the age of innovation, failure is seen as a fruit full of experience, failure is very much an intrinsic part of innovating. Innovation fails because there are too many disconnects that occur between the birth of an innovative concept and the process of turning it into a reality. It’s understandable for fears of failure - especially failures come dressed in many disguises. But it is important to identify gaps and avoid pitfalls on the way. Innovations fail because folks fear innovation. Innovations succeed when failure is seen as a learning step to great success. Innovation is costly most of the time. The point is how to avoid repetitive mistakes and focus on lessons learned from failures. A well-developed innovation framework with the periodic review will help businesses sustain innovation progress and minimize risks of idea flops. To improve the innovation success rate, it is a balancing act to have enough failure and a risk-tolerant environment that encourages learning from failure quickly and cost-effectively, without having failures that are too frequent or too expensive.

Innovation is what leads to differentiation. There are many ways to differentiate and, therefore, there are many ways to pursue innovation. The nature of how the "implementation of the idea has to follow a logical path for the solution,” provides a great opportunity for managing digital innovation. Innovation is a necessity and interdisciplinary management practice to lift their organization to the next level of business maturity.


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