A Simple Guide to Organize Innovation [2021 Update]
Innovation is everywhere — from smartphones to self-driving cars. It is always present, even if we don’t always see it.
On other hand, it’s important to note that innovation is not only about cool new products, gadgets, drones, artificial intelligence, and all the new gadgets and technology that you can use. Innovation is about developing a way of working that delivers results.
In this article, you will learn various innovation principles that are central to applying the innovation framework and see the bigger picture on how to start your own successful innovation projects.
What really is innovation?
Most people think that innovation is all about creating the next Tesla, Apple, or Spotify. Sure, these companies are innovative and successful. However, you don’t need the same standard to live up to be an innovative organization.
“Innovation is the process of realizing new products, processes, propositions, or business models to create added value for customers and/or employees.”
Innovation is not always about earning money. Mostly, innovation is about creating value for customers and/or employees.
Of course, innovation is an investment, which costs resources. On that note, it’s only when the innovation project is successful and embedded in the operations of your organizations when you start earning money and making a profit.
Why do you need to innovate?
As stated earlier, innovation, though it’s technically considered an investment, is not always about earning money. However, it will largely affect the company and could be one of the factors that would dictate whether or not that business will last.
Aside from that, the following are the reasons why it’s important to innovation:
Improving current work
Capturing opportunities and trends
Improving customer performance and satisfaction
Improving employee performance and satisfaction
Unfortunately, despite all these benefits, some organizations choose to not invest in innovation. There can be different reasons for this. It could be that they have had bad experiences with it in the past or that they think that there’s no need to improve their business.
The problem is, there’s a greater risk when organizations choose not to innovate. Lots of major companies in the past like Kodak, Nokia, Pan Am, and many others. This is why innovation is key to the survival of the business.
When is innovation successful?
Innovations are projects with a determined start and end date. Some people claim that innovation is an iterative process. That is also true. Either way, you have to define the phase of the project along with when this phase is considered complete.
In practice, you can use the term “definition of done”, which needs to be defined before you start. It’s important to acknowledge that the innovation project isn’t “really done” until the definition of done is reached.
One of the most important things is to not only focus on the business value (internal) but also on the end user value (target group). After all, that will be the group that uses the innovation in the end.
As you may know, there would be countless completed innovation projects that will not yet return any value. The reason for this is often that the end user is not involved at all or too late. In most cases, the end user wasn’t satisfied with the outcome.
The focus on getting results is important to maintain. That doesn’t mean though that this is the only thing to focus on in the process. In the end, the innovation is meant to create value to satisfy the end user.
Oftentimes, the user has an insight into what the solution must look like. Getting to know the end user and involving the target group will help you get a successful result.
What is the innovation framework?
The Innovation Management Framework shows how you can implement a sustainable innovation system, or innovation engine, within your organization. When designing one, it’s important to be clear about the following:
Who will manage the entire innovation process
Who will be responsible
Which important stakeholders will actually implement the result of the innovation(s)
Successful organizations have a clear system of innovation — what we call the “Innovation Engine”.
This engine is fueled by innovative ideas and/or problems. The innovation inbox is the filter. After taking in all the information, the inbox, managed by the innovation manager, determines which innovation ideas are the best to execute as an innovation project.
When the decision is made to execute an innovation, the information is placed in the innovation roadmap that tells when the innovation will be executed. The innovation roadmap is the responsibility of the innovation director and his/her innovation team.
What is innovation strategy all about?
The most important goals and execution roadmap for innovations are determined based on the organizational strategy and careful research. After researching thoroughly, you can develop an innovation strategy.
One of the best ways to innovate is to focus both on the strategic problems (top-down) and on the opportunities (bottom-up). We call these proactive and reactive innovations, a type of applicable innovation strategy that you could apply to your business.
Proactive – asking questions to the target group to gather insights.
Reactive – getting new ideas by engaging with customers and suppliers.
Every year, the organization’s strategy is updated to achieve the short-term goals, which help achieve the long-term goals in the end.
Efficient organizations already have this long-term and short-term strategy in place that spans one to three years. Once you have these in place, you can link the innovation framework to the business strategy.
How to execute innovation the right way?
Every project has several stages. Every innovation project has a project leader and a dedicated team to execute the innovation.
When carrying out an innovation project, it first goes through the three phases of the ‘innovation fuzzy front end’. It then goes through the delivery phases in your existing project management: business plan, development, and delivery.
The fuzzy front end is the phase where the actual solution is still fuzzy around the edges and not yet well-defined. The phases here are necessary to help find the real problem and manage the process of generating ideas, selecting the best ideas, and developing a solid solution.
The first three stages can be delivered within weeks. To move from one stage to the next, the innovation manager or the innovation board must first approve it. Once they give their ‘go’, it’s time to proceed with the last three phases:
Business Plan: After a successful experiment, a business case will be created in which finances will also be pictured out.
Development: Based on the innovation itself, the development of the innovation is carried out with a clear view of the desired result.
Delivery: This is when the solution is implemented and adopted.
Delivery is complete when the end user values the result with an 8 or higher. A pilot is often carried out before the actual product is delivered to the end user.
How to implement an innovation sprint?
The innovation sprint is a timeboxed period (1–4 weeks) to develop three possible solutions and assemble proof to decide which concept is the most valuable and feasible. It’s a great innovation tool for focusing on innovation for a couple of days with a team.
An innovation sprint is a perfect tool to test whether an innovation idea is executable. Even if the innovation idea sounds really good, always put it through the innovation sprint process. Within weeks, you will have a clear result.
What’s more, is that you can make a decision as to whether the problem and the possible solution(s) can really be executed and will deliver the business value necessary to invest in. An innovation sprint can be executed from start to finish in a lead time of one month.
Here is a viable innovation sprint model:
Here are the six steps:
Preparation: This is where the innovation core team is appointed, and together with the business owner (problem owner), the core team discusses the scope and defines the innovation project.
Problem finding: This is where the discovery of the real problem that needs to be solved, happens.
Idea generation: This is where you generate as many ideas as possible with a preferably diverse group (employees, customers, external parties, and other stakeholders).
Idea selection: The ideas are scaled back to the best concept, or the best three concepts, in a number of smart selection rounds.
Concepting: The concept(s) is/are built into a concrete project, which can be a design, working app, animation, infographic, basic application, mock-up, or a sample.
Presentation: The final result is presented to the stakeholders for validation, and the customers/end users give their feedback.
How does an innovation sprint master work?
An innovation sprint master guides the innovation process from start (initiation) to finish (result). He or she must prepare everything and ensure that the process runs smoothly so that the right results can be achieved.
The innovation sprint master always starts by taking in the innovation project in its entirety. Every project starts with a clear goal. Usually, it starts with an idea or a problem that needs to be solved.
Either way, the sprint master goes over the project and then determines who the internal and external stakeholders will be and who will join the core team.
The sprint master starts and ends each day with a kick-off and touchdown meeting and shows where the team currently stands in the sprint. The sprint master also keeps the stakeholders in the loop with additional communication.
It’s a good idea to ensure that a number of sprint masters have been trained within your organization and that those people can gain experience in running in-house sprints. Before you have your internal people in place and fully trained, you can use external innovation sprint masters.
Organizing Innovation in Your Organization
As you can see, there are various innovation principles that you need to learn that are central to applying the innovation framework. These principles would help you start your own successful innovation projects in your organization.
Unfortunately, the topic of how to organize innovation is vast. There are more things you need to learn, including specific steps on how to design an innovation framework.
Next steps: If you would like to learn more on how to organize innovation, we have a book that “captures the vision, strategy, and tools for innovation, not from a theoretical point of view, but based on a lot of experience” (reader feedback).
This book has only one goal — to explain how to organize innovation successfully. It’s especially helpful for you as an Innovation manager/director, business development employee, innovation team member, director or CEO, and anyone else who is curious about innovation.