It is difficult to look at a business magazine, read an annual report or watch the news without seeing a story about innovation. Rightly so, innovation and the efforts to develop it as a habit are critical to the success of every company. Yet, innovation has become a catch-all phrase that refers to virtually every move a company makes no matter how small that “innovation” may actually be.
We’ve all read about individuals at organizations being told to play with balloons to gain a three-dimensional approach to products, lie under chairs to view the world from a different perspective and design something that has never been considered at the company. The results of these efforts while perhaps entertaining are most often a gigantic waste of time, money and the spirit of those involved. After such “experiences,” the participants return to find their e-mail inbox full, the innovation ideas forgotten and new fires burning at the office. As was reported so eloquently in BusinessWeek (May 8, 2006), Whirlpool, who has achieved substantial, deep change in their organization only after focusing their efforts on results, experienced the frustrating results when employees are told to “innovate” without bounds:
“Off in the Italian Alps, a crew of workers got right at it. Handpicked by managers from across the company’s European staff, the 25 employees were freed from their regular jobs and packed off to Whirlpool’s office in Comerio, Italy, with a single purpose: to dream up products or services that would truly differentiate Whirlpool from rivals. A year later, they came back with their big brainstorm: an Internet business that would enable people to race one another over the Web on stationary bikes. So much for that experiment. It was obvious that Net bike racing, which didn’t draw on any of Whirlpool’s strengths, was a nonstarter.”
Innovation without execution and innovation that is not connected to the fundamental capabilities of a business are among the more demoralizing experiences that employees in a business may have to deal with. Thus it is not innovation that is needed in companies — that is simply too broad. It is EnnovationTM, innovation that enlists the skills and participation resident within its organization, innovation that is entrepreneurial, innovation that is tied to the entire company’s capabilities, innovation that engages the organization to develop frame-breaking products and services, innovation that enables a company to differentiate its products and services from the competition, innovation that is executable, and innovation that creates real economic returns. How can this be done?
The traditional method to “acting innovative” is to streamline the process and perform only steps two and three. Staff can minimize the time away from the office and the process has a “fun” nature to it. Take a look at the many companies that mistake “creative fun” for “results-oriented innovation.” The key to successfully implementing ennovation is approaching an idea as the mid-point in a process that starts with a deep understanding of the market/business/customer and finishes with a business case/prototype/investment. Most companies inherently understand that a new product/service will only be valuable to the company if it fits with their unique capabilities and yet a deep analysis of these unique resources/capabilities rarely starts off a so-called “innovation” session. Fit with the strategy, history and capabilities of the organization is one of the most profound ennovation success factors found in practice. Carrying this to the next step is the ability to accurately define the appropriate market and perfect customer.
We live in a time where consumer expectations are higher than ever before. Household brands are being replaced by innovative new products and better designed private label and store brands. It is product innovation that allows brands to maintain their equity and command higher margins. Without innovation, a company’s product or service will eventually become a commodity bought at the lowest price.
Companies today need to re-energize their efforts towards innovation and abandon the familiar “brainstorming” sessions that were once enough to be considered innovative. The ennovation approach allows for the ideas to come from a cross-functional group of the company and most importantly, leads all the way to execution. The ennovation process begins with the selection of internal sales, marketing and product development staff, but adds the participation of finance, manufacturing, customer service and operations. This internal team has the unique knowledge of the customer, the process and the company. To be truly effective, ennovation also requires an external spark to create combustion. This comes from industrial and graphic designers, market research experts and behavioral scientists who can tap into trends and successes that are occurring in other industries. The final step is the conversion of the idea into a practical business approach that allows the company to monetize the effort. Innovation without concrete results is just lip service to this critical approach available to businesses today in their effort to attain a continuing competitive advantage.
