What is innovation? How to innovate for transformational change
Innovation is today’s buzzword. Every CEO claims that his company is at the forefront of innovation – at least every CEO who wants to keep his or her job. Every politician talks about the need for his country to be innovative if it is to grow and prosper. The innovation word is everywhere but I don’t believe is understood when it applies to anything except small start-ups, who have no alternative but to innovate.
So if you are an existing company or a government department then what is innovation for you?
What innovation is NOT
Let’s start with what innovation is NOT
- It’s not taking an existing product or service and painting it a different colour or taking it to another market. That’s product marketing and something every company should be doing, all the time
- It’s not taking an existing product and adapting it to different uses; that’s product development. And again, something every product manager should be doing
- It’s not rebranding your company with an expensive new logo and hoping that your customers will see you differently.
So if it’s not those things, then what is innovation?
The clue is in Robert Oppenheimer’s words on seeing the atom bomb “I am become death, the destroyer of worlds”.
Atomic power, whether we like it or loathe it, is one of the defining innovations of the 20th century.
Oppenheimer, probably unknowingly, spoke a great truth: to be an innovator you have to be a destroyer.
Innovation is about stopping doing things
In all the work I have done with companies over the years, what has always marked out great companies has been their willingness not to start doing things, which is easy, but to stop doing things, which is very difficult. People love to start things; nothing gives a board or an executive team a greater thrill than to sign off new projects.
The result is an organisation with layer upon layer of new initiatives, all in the name of innovation. Targets, and plans allocated to teams who are already juggling the impossible – trying to complete all the previous projects, cope with the new ones and also keep business as usual up an running. And what happens is gridlock. Everything runs late, people are exhausted, they make mistakes and eventually leave. Look at the National Health Service if you want a great example of this in practice.
This is not innovation, this is bad management masquerading as innovation.
So what do you need to do if you want to make major changes in your organisation?
How to make transformational change
Transformational change is about doing a very small number of very hard things.
Firstly, you have to make an honest assessment of the things that you HAVE to do. Really have to do, not the things that you would like to do but the things you have to do to keep your business afloat. This is a hard question because it is about the core of your business. What is it you are there to do? What is the purpose of your business? If the answer is “make money” or “make the shareholders happy” then you do not have a purpose and you should seriously think about giving up.
Once you know what you have to do then look at two things
- Is there a better way to do what you have to do? This should be where ideas for innovation start. There is almost always a better way
- How many people do you need to do what you have to do, to a standard which is acceptable to your customers?
To do this you need to get a diverse mix of your best and smartest people. They are not your board (though they should own and sponsor the process). They are not your strategy team (they got you here, they won’t get you there). They are not external consultants (though they can be a useful sanity check and may know more about what is going on in your competitors than you do).
You need people from all levels in the organisation, including those at the coal face who know more about what is going on in the business than you do. Give them time (it will pay off in the end in spite of the appeal of saying “we need the report in an impossible time scale”).
When they have decided what needs to be done, then empower people to make the changes and resource them properly. If you need to increase the resource then find ways of doing that. Be prepared to take the really tough decisions. If sacred cows have to be shot, then hand the team a gun. Realise also that to transform your business may take a few big changes but it will also take many small ones. Both sorts of change are important.
At the end of the process you will have a business that is transformed. It may not look like your old business but it will have found its purpose, be smart and agile and ready to move on.
Then you have achieved real innovation.