With the right innovation appetite, attitude, and aptitude, the organization is on the right track of developing innovation as a business-wide unique competency.
Digital is the age of innovation, Innovation is always a tough journey, not a flat road. Digital innovation is coming at seemingly much faster paces, and there are more potential disruptions, with a broader scope, scale, and impact on the business’s long term surviving and thriving. Companies have to be prepared to lose some to gain more for the longer term. They need to make an objective assessment of their innovation appetite, attitude, and aptitude, and manage an innovation portfolio strategically and systematically to achieve great business results for the long term.
The innovation appetite: There are always risks involved in managing innovation. The innovation appetite of the business directly impact on how aggressively the company can manage innovation and the time-frame they focus on. Breakthrough innovation has greater ROI but with much bigger risks and often takes longer time to achieve. The variety of research identifies innovation initiatives that ultimately break new ground frequently are fraught with uncertain on many dimensions such as technical, market, resource, and organizational uncertainties abound. Innovation is risky because money and resource spent on R&D is not necessarily a good indicator of future innovation performance. Therefore, innovation leaders with the right dose of innovation appetite can manage a healthy innovation portfolio with the right mix of incremental innovation and breakthrough innovation, to reap the short-term gain and long-term innovation benefits. The shareholders who highly value innovation would value organizations with bigger innovation appetite and devote more resources towards future breakthrough innovation more than those that only manage short-term incremental innovation.
The innovation attitude: Innovation is high-risky because more often you are doing something that hasn't been done before. Innovation risk would broadly need to consider both endogenous and exogenous drivers. It is the common knowledge that innovation management requires the highest risk taking at a strategic value chain, including organization, investments, and assets. From a financial management perspective, consider what capital you are prepared to risk in making the innovation- never let this be too much that losing it will cripple your business. The differentiation between a good innovation and bad innovation is the innovation leader’s attitude toward risk. The job of innovation management is to help when a failure happens to turn it around as a team. The good innovation leaders have excellent attitude toward innovation, demonstrate rational risk management skills and are able to shift from “risk-avoidance” to “risk-intelligence” mentality. The great attitude towards innovation is about taking calculated risks to inspire good innovation initiatives for capturing growth opportunities, being cautious about obstacles or pitfalls, staying focused, weighing risks and rewards, taking prudent risks and discovering better ways to mitigate risks rather than eliminate it. De-risk the introduction of innovations into the market, protecting existing operations and brands and establishing clear proof-of-concept before making investments to launch and scale.
With the right innovation appetite, attitude, and aptitude, the organization is on the right track of developing innovation as a business-wide unique competency. A leading digital organization with innovation competency can handle innovation streams for different goals and different time frames and manage a balanced portfolio including both radical innovation and incremental innovation, hard innovation and soft innovation seamlessly.
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