Tips on striking the balance between generating new IP/innovation and ops/delivery, and some considerations around doing so – from the 2017 series of Threads discussions.
Discussion host: Peter Cain, change and growth consultant at Anamosys
You’ve done your research, the product is launched, and now you’re busy improving things and delivering new features. Yet, fresh innovation must still happen, or you may miss opportunities.
Continuous innovation for tech firms
How you innovate will evolve and change as you grow. Think about what innovation your business needs to do during each phase of its growth, and choose appropriate strategies to make it happen.
Build up a war chest of innovation. Just because customers or competitors don’t seem to innovate, it doesn’t mean that they aren’t. Businesses are more likely to struggle because they did too little innovation rather than too much, so keep the thermostat of innovation warm.
Building an innovative culture
Foster a culture of ambient innovation, where day-to-day innovation on a small scale is encouraged and celebrated. Define strategic and tactical objectives, and encourage targeted innovation that leads towards them.
Build good communications between customer facing teams and those in engineering. Aim for balance of control and open dialogue. Mix things up and move people around.
Creating an innovative environment
Expose engineers to the pain points of your customers, with the filter of your business development process removed, as it may otherwise skew the solutions they devise.
If you experience innovation feast:famine, then set aside a defined resource level and budget, firewalled from the day-to-day operation. This helps towards a steady state of innovation.
Continuous improvement is rearward looking, with incremental changes and improvements. Innovation is forward looking, it’s about throwing away the past and working backwards from the future.
Those innovating in the CTO office or in ‘skunk works’ are often seen as having all the fun, while others are bringing home the bacon. Empower all your people to innovate, whether it be strategic or day-to-day.
All employees can innovate
Regularly broadcast that innovation is a good thing that everyone should be doing. Google’s ‘20% time’ worked because it made innovation part of everyone’s daily habit. Find a way to capture the informal innovation that people do in their spare time at work.
For professional services firms, it’s the brilliance of your engineers that you’re selling; so empower them to talk to customers. They can make awesome sales weapons. This works particularly well in niche high-value markets.
Businesses that have become compartmentalised can find it hard to innovate across the silos. Innovation can suffer as structure is added to support growth so look for ways to cut across the whole business.
Targeting the innovation
Aim to solve things that seem unsolvable. Allocate a number of days per month to the team and make this a formal, recognised, internal deliverable.
An inter-team ‘race’ towards innovation can promote healthy competition and the creation of a range of different ideas to solve a problem.
Ideas can be cheap. It’s getting them validated, executed and then scaled that brings increasing levels of cost, and reward.
Much of innovation is a refinement and optimisation exercise. True ‘revolution’ moments tend to happen in a flash. Accept that it’s often 1% innovation, 99% perspiration.
The right amount of innovation
Accept that innovation can have a high failure rate.
While innovation can seem an intrinsically good thing, the balance between innovation, delivery and operations needs to be controlled to match the current stage and state of the business.
Think about who you recognise for the innovation and how you value them. The originator of the idea may be recognised and valued differently from the executor.
Consider whether your innovators build out the resulting product and its revenue. Some will find this appealing and want to follow the product or spin-out. For others, it’s about delivering a repeatable creative and tactical problem-solving process.
Commercialising the outputs
When the originators of high-value innovation follow it into a start-up or spin out company, treat them as role models and celebrate their success.
Design services firms may hit a stage in their growth, usually around 50 or 60 staff, when it’s better to spin out new products and services than to expand headcount. At this point, they may need a new layer of structure to see them through to 100+ staff.
Product focused businesses may experience a tension between delivering product – for lower costs and higher efficiency – and innovation. This tension needs to be acknowledged and carefully managed.
Patents are a by-product of innovation. They arise from the development of an idea and not just from the idea itself, so wait to patent a new idea until you’ve worked out where it may lead.
Be aware if customers and the market aren’t ready for radical change or innovation.