How to Start a Flood of Innovation

A proven approach to Driving Innovation

This is a brief overview of an approach to creating or enhancing the innovation capabilities of a company or group within a company.

A great quote from Peter Drucker to get us started, “Systematic innovation consists in the purposeful and organized search for changes, and in the systematic analysis of the opportunity such changes might offer for economic or social innovation.”

The challenge
Let’s consider the innovation challenge of any number of large or very large companies with 5,000, 20,000 or even 100,000 people spread across many countries. Such companies have an abundance of innovation opportunities buried within the hearts and minds of its people. The goal in creating and enhancing the innovation culture is to release that potential by inspiring every single person to participate in innovation and contribute their ideas. This can be achieved by consistently communicating the message of the importance of innovation to everyone’s future, being clear what innovation means, how each person can contribute and by providing a clear and simple process or set of processes that will ensure ideas are captured and converted into tangible measurable benefits for the customers and the company.

The law of large numbers is in effect and the magic is in providing the leadership needed across locations and teams so that people see they can make a difference and get to see and experience how ideas are turned into success stories for the company or individuals and teams.

What is needed to be in place to support and encourage an innovation culture?
1. You need to clearly show that leaders in the company truly believe that there is a need for innovation and that they are speaking through their actions by encouraging innovation and supporting it in a very active and visible way.

2. You need to frame innovation so that everyone knows what is meant by innovation. You need to be clear about the range of things it defines as innovation, whether it is the creation of a new market leading product, the elimination of a redundant step in a service offering, or a small process change that makes our own or our customers work easier. People respond better when the message is clear and the definition of innovation is constrained; this approach is normally more successful than doing an unstructured open ended approach.

3. You need to be systematic in the approach to innovation. You need to make innovation an integral part of the organization and drive it. Innovation needs to be part of and aligned with the strategy. Leaders need to be held accountable for their contribution to innovation. Innovation needs to be reported at all levels and at regular executive meetings. It is a critical business KPI – value delivered. The organization needs to communicate and share the progress in innovation to help spread the adoption of the culture.

What tangible benefits will a systematic approach bring?
The following are real results that were delivered at a company as a result of a systematic approach to innovation. The term “Value Delivered” is used because projects delivered various benefits that included increased revenue, costs savings and cost avoidance. In year 3 the value delivered equaled about 5% of the total company revenue. [Some of the value created was going to be created with or without a new program, whereas more was the result of the programs focus on innovation and encouraging people’s contribution. Either way the value of the innovation effort was clearly visible]

A second example from another company running the same approach (not charted above) resulted in $30m of value delivered in projects based on more than 9000 initial ideas in a company of 6500 people, as well as a greater sense of pride in the company and a much improved Net Promoters score from the customers.

A program
A key issue to remember is that programs or tools in themselves will not ensure success. Successful transformations depend on leadership, culture and people. That being said a structure is needed, as are some tools that will make it easy for people to get involved and for everyone to be able to see progress.

The program is the channel through which employees’ ideas are collected and used to create innovative ways to improve the business of our customers with new or more efficient products and services, as well as to improve how we do business by removing unnecessary costs and improving how we work.

The core of the program is to target one idea per person per year. Ideas are collected and reviewed. Ideas can turn into projects, quick wins (easy enough to just go do it), or might not progress further if the timing is not right or if the idea does not fit with the strategy.

Some key outcomes of a good innovation program are listed below. This range of outcomes is purposely varied enough to allow all people in a company to contribute in some meaningful way to driving innovation.

• Increasing revenue streams
• Improving products
• Reducing costs
• Improving; changing and at times removing unnecessary processes
• Identifying ways to drive a better service for customers
• Company-wide awareness of the realized benefits using all available communications media
• A sense of personal ownership and accountability by each person in the company for their part in driving innovation.

A tool is needed to capture and track the ideas, projects and the value delivered. The tool needs to have the following high level characteristics,

1. Easily available – an internally accessible website that all employees can get to directly or with the help of a Networker (a local person who has volunteered and been trained to help the people at their site).
2. Easy to use – the tools should be as easy to use as possible so that more people embrace them.
3. Allow for collaboration – most projects will require the collaboration of a number of people and the tool must aid that.
4. Produce clear reports of key performance indicators - so that there is one version of the truth and people do not need to waste time creating their own reports.

Innovation Calendar
The initial setup of a good innovation program could range from 3-6 months based on previous rollout experience. Thereafter driving innovation is a function and should follow a predictable drum beat. Here is a suggested calender that would drive the annual pace and the monthly pace, you should of course incorporate any existing initiatives, if they are working very well, with the overall coordinated program suggested here.

Something for you to think about
None of what I suggest in this article is rocket science. The magic is in the execution. You need to know and believe that following a systematic approach to innovation will make the needed difference. You need to work very hard each day to help drive and deliver innovation and to ensure that there is engagement at every level inside your organization. Oh yes, and have some fun along the way.

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