9 Ways to Ensure Continuous Innovation
Organizational leaders tend to believe their companies are innovative, but the competitive landscape can tell a much different story.
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Individuals often say they think outside the box, but if the idea can’t be turned into a product, service or solution, then the idea has dubious value -- or worse, no value.
For example, Chris Sorensen, distinguished professor emeritus at Kansas State University and vice president R & D at HydroGraph Clean Power, discovered a way to produce graphene by combining acetylene and oxygen and detonating it with a little bit of energy in a bottle. In just 15 milliseconds, the result is clean black graphene powder that can be used in countless applications, like making plastic and concrete stronger and detecting lung cancer faster. HydroGraph can also change the graphene’s form to better suit specific use cases.
“You can’t improve [the value of innovation] in a lab. You have to connect with the customer,” says Ranjith Divigalpitiya, chief science officer at HydroGraph. “[Although] we’re a startup, we have the proper processes in place. Leadership has provided a framework to get the right innovation processes in place.”
A company’s culture can make the difference between succeeding and failing. The most mature organizations understand this, which is why innovation is an integral part of their business strategy as opposed to a separate initiative.
“You can have a great team and a great process, but if the culture doesn’t support innovation, then it’s not going to work,” says Helene Cahan, author of FIRE UP INNOVATION: Sparking and Sustaining Innovation Teams. “The problem is innovation is risky and ambiguous. We might fail. So, there’s a level of anxiety, so how can we help the team with processes, tools, culture and understanding the thinking behind innovation to really work better together?”
Most innovations fail, and most organizations are fearful of failing at their innovations because it’s costly, time-consuming, and can distract team members from the company’s core competency. On the other hand, without innovation, organizations struggle to survive, let alone thrive. So, exactly how much failure is acceptable? That depends on an organization’s risk appetite.
Also bear in mind that the accelerating speed of business has impacted the innovation process. The traditional plan, execute, and evaluate method has been replaced by minimally viable products (MVPs) and fast iteration. It’s also wise to have a goal the innovation is meant to accomplish and a line item on the budget for innovation, so there’s a cap on costs and controls that prevent additional money being funneled to non-viable projects.
“There’s a tendency that we want to be perfect. We don’t even show things to management until we have a 50-page deck and all that,” says Helene Cahan, author of FIRE UP INNOVATION: Sparking and Sustaining Innovation Teams. “There may be a way to test ideas with users very early -- we don’t need 500 users; we might just need 20.”
Yes, there’s an app for that, but when it comes to innovation, it’s about listening and observation.
“Customer research is at the heart of innovation. If organizations want to master sustainable innovation, they must view their customers as the experts in what they need and collaborate with them to help deliver solutions that are true innovations, not just ‘inventions,” says Josh Langley, chief information officer at enterprise information management company Iron Mountain.
Conducting in-depth, qualitative exploratory conversations with customers at the start of a project can help them frame their specific challenges and experience. Through this research, organizations can receive feedback and learn the who, what, where, when, why and how. If those discussions uncover new challenges, organizations should consider adding follow-up interviews to expand their understanding. This process can help organizations reimagine how or what they need to change for an improved customer experience.
“While exploratory research informs new solutions and capabilities, qualitative message testing informs how an organization’s marketing team should talk about the value of a solution to those involved in the solution’s acquisition. Messages are introduced to get their feedback on whether the language is clear,” says Langley. “Finally, researching trends in key industries and the technology developments or initiatives that are being covered by media helps organizations anticipate emerging technologies and use cases.”
The practicality of an idea makes the difference between successful and unsuccessful innovation. Considering areas adjacent to your company’s core competency can be fertile ground, for old customers and new ones.
“Innovation is a very large bucket. You can look at areas adjacent to your core competency and pick a new area or even take a hybrid approach, says Ravi Samavedam, chief innovation officer at Azzur Group, which help companies in the health and life science industry bring their projects to life. “Depending on which path you choose, it can be very wasteful, very distracting from your core competency, so you need to be very careful.”
For example, Blue Bottle Coffee (not an Azzur Group client), identified a commercially viable adjacency:
“We revisited traditional coffee categories, seeking opportunities for reinvention [and we] identified a notable trend. The substantial growth of espresso contrasted with the sluggish nature of the instant coffee category, [so] we strategically planned our innovation around these insights,” says Cara Ray, global product director for CPG innovation at Blue Bottle Coffee. “This led to the creation of Blue Bottle Craft Instant Espresso, showcasing how a thoughtful reevaluation of existing categories and alignment with emerging trends can yield impactful and successful innovations.”
In 2015 or 2016, Azzur Group noticed that startups were out innovating big pharma, and both types of organizations faced constraints. Specifically, in the Cambridge, Mass.-area, startups were looking to sell gene therapies but had no practical way of manufacturing them at scale while the big pharma companies were manufacturing products en masse. While the startups could work with manufacturing partners, that meant handing over their IP, so Azzur Group came up with the idea of “clean rooms on demand,” that allows startups to test their IP in an economical way. The first clean room, launched in 2017, was also staffed by Azzur Group to further accelerate biopharma manufacturing. Now they have about 60 clean rooms in the US.
“Moderna Therapeutics is a great example of a success story. They had to address the pandemic somehow and they needed massive amounts of capacity. They used our capacity in Burlington, Massachusetts to make parts of the COVID vaccine, which really helped them with the pandemic,” says Ravi Samavedam, chief innovation officer at Azzur Group.
Some organizations turn to the open-source community or start accelerators with the goal of accessing an ecosystem that’s fueled by innovation. For example, in 2018, cybersecurity solution provider Venafi launched a machine identity management development fund to identify early innovators that could help protect Venafi’s customers in the future. So far, the company has sponsored over 50 developers, some of which have received significant investment and/or were acquired. Unlike most investors, Venafi does not take equity in exchange for the capital.
“When you don’t take ownership, but helping to further than innovation it creates a different type of environment,” said Kevin Bocek chief innovation officer at machine identity management company Venafi. “[For] example, in 2018, I met with two founders in the UK who identified that while Kubernetes was going to be very important to changing the way businesses operated technology, it also needed an identity. So, we sponsored them in 2018 and 2019. Then, in 2020, we acquired the company and in 2022 and 2023 we released products that were driven from the innovation that had started 5 years earlier.”
More companies have appointed chief innovation officers and are getting mixed results. While the good ones are worth their weight in gold, organizations may not be able to discern who really qualifies for the role.
“The rush to appoint a new “chief” is more often done for optics than tangible business benefits. This trend appears whenever there is a hot new area that CEOs want investors to know the company is addressing,” says Iliya Rybchin, partner at Elixirr Consulting. “Success in any senior role is not a person with a title, but the processes, culture, strategic decisions, investments, and talent assembled to execute leadership’s mandate.”
Many of the chief roles -- including chief innovation officers -- fail because the individual is anointed with great fanfare but is not given sufficient budget, resources, or attention. Then, when the CEO, board, or both move onto the next hot topic, the flavor-of-the-month-chief is abandoned, says Rybchin.
In short, a chief innovation officer isn’t the only person with good ideas. Innovation can come from anywhere in the organization. In fact, some of the best chief innovation officers orchestrate innovation.
If you wanted to innovate in energy infrastructure construction sector, using eucalyptus might not be the first thing that comes to mind, but if you’re building a transmission line, pipeline, wind farm solar arrays, bridges and roads, you’ll need temporary ground protection. World Forest Group makes eucalyptus timber mats -- a material that has been proven to lower costs and improve productivity.
For example, one nationwide engineering/procure/construct (EPC) firm used a single, stronger uniform eucalyptus timber mat to reduce the mat layers from two layers to one, which represents about a 50% cost reduction or $500,000 per project. Another nationwide EPC firm can finish jobs 20% faster, which translates to lower costs, more jobs per year using the same crew, more profit, and the ability to bid on jobs more successfully. The estimated savings per project are $36 billion.
“The big payoff is when innovation solves the system’s bottleneck,” says Jeffrey Atkin, CEO of World Forest Group. “Solving that bottleneck produces results that look miraculous, because the weakest link is now stronger and the whole system works better, faster, cheaper.”
If you wanted to innovate in energy infrastructure construction sector, using eucalyptus might not be the first thing that comes to mind, but if you’re building a transmission line, pipeline, wind farm solar arrays, bridges and roads, you’ll need temporary ground protection. World Forest Group makes eucalyptus timber mats -- a material that has been proven to lower costs and improve productivity.
For example, one nationwide engineering/procure/construct (EPC) firm used a single, stronger uniform eucalyptus timber mat to reduce the mat layers from two layers to one, which represents about a 50% cost reduction or $500,000 per project. Another nationwide EPC firm can finish jobs 20% faster, which translates to lower costs, more jobs per year using the same crew, more profit, and the ability to bid on jobs more successfully. The estimated savings per project are $36 billion.
“The big payoff is when innovation solves the system’s bottleneck,” says Jeffrey Atkin, CEO of World Forest Group. “Solving that bottleneck produces results that look miraculous, because the weakest link is now stronger and the whole system works better, faster, cheaper.”
The technology sector is synonymous with innovation, but there are a lot of one-hit wonders and fewer organizations that have mastered the art and science of it. It turns out there are many differences between those who consistently innovate and those that don’t when simple things can make all the difference.
“Only a small number of companies understand the business value of their entire portfolio of innovations in bringing an elevated concept to market,” says Trevor Anulewicz, VP, strategy at accelerator Launch by NTT Data. “[C]ompanies struggle with scaling innovations and calculating the value and ROI. They have to have a deep understanding of their ROI at the program level to scale, justify, secure funding and bring the right talent to continue to do this on repeat.”
Once companies are clear on ROI, they can understand what type of innovator and company they want to be. They can also determine where they are in the innovation process and can establish a repeatable system for bringing new ideas to market successfully year after year.
“In today’s competitive landscape, businesses have no choice but to evolve and improve. Organizations need a framework for continuous innovation that helps [them] generate and evaluate breakthrough ideas and rapidly prototype, test and scale promising concepts,” says Anulewicz.
Using a framework also helps identify the blind spots, weak systems, and strategic errors holding the organization back.
“Maturation is what the vast majority of large enterprises need to sustain innovation,” says Anulewicz. “Making it part of the fabric of the culture is how companies succeed in the long run.”
The following are more points that can help companies navigate the pitfalls.
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