Innovation is a Strategy, Not an Epiphany

We recently hosted a business breakfast dialogue in Victoria, BC at which the topic was innovation, specifically how Virtual City Ltd., an East African company, has leap-frogged over North-America and other western economies and developed a unique and ingenious way of managing business transactions throughout the supply chain using cellular technology.

Dr. Don Simpson, of Innovation Expedition Inc., outlined how the young entrepreneurs who started Virtual City developed a means of delivering supply chain solutions to the East African business community which would be impossible if trying to utilize the same infrastructure the 'western' world relies on.  Instead, Virtual City invented a new way for each stage in the supply chain to transfer goods and money in which the system is fully automated and no actual money changes hands -- all transactions are done with cell phones.  They 'beam' the information from one player in the supply chain to the other, thereby solving the problem of corruption and creating significant administrative cost savings for companies.  It is an inspiring story of innovation success.

Innovation is a hot topic in business.  It's always a hot topic, but what is it, exactly?  Is it the purview of only the large and flashy corporations producing tech gadgets, like Apple or RIM? Or is innovation a common element of a sustainable business strategy, even for ‘Mom & Pop’ shops?  There are exciting stories of world changing innovations, however, the business research literature maintains that innovation is a strategy for every business and can be as simple as looking to find unique ways to deliver something to a customer.  Innovation is a standard business practice supporting sustainability.

Innovation is a strategy, not an epiphany.

Rather than waiting for the lightening bolt of inspiration to strike, building a strategy that supports innovation helps ensure ideas become success stories rather than ill conceived flops.  The first question to ask is:

• What kinds of ideas should we come up with in the first place?

This one sets the stage, draws the parameters and helps filter ideas to enable sound decision making.  In an amusing article in Fast Company in August, 2009, the author, Dev Patnaik, describes his involvement in the launch of a new product that was a huge flop.  The primary reason for the failure was that they designed the wrong product for the wrong target market in a way that the author says, "ensured the deck was stacked against us."  It wasn't because the product was terrible, or that there wasn't a need for the product.  It was that they were the wrong company to be manufacturing and selling this product and the end-user was not a market known to them.  It did not fit with their business.

This highlights several other questions to ask in developing your innovation strategy:

• Do you understand your customers?

Who is your target customer?  Who do you focus on?  What do they want and what are their challenges? 

You can't be all things to all people, but you can be a unique solution to your current customer base.  By understanding who you serve you can then ask the question: what are we not doing that we could be doing to better solve their challenges?

Just because you can, doesn't mean you should.

Throw everything at the wall and see what sticks should not be your strategy for innovation.

• Do you know what you should be innovating?
• What are you uniquely qualified to provide?  What are your core strengths?

Clarity and focus comes from answering these questions.  You are better able to put energy towards uncovering simple innovations that can set you apart and help ensure that limited resources (time and money) aren't wasted.

A recent Business Innovator Lab™ participant wanted to innovate their business in response to the economic downturn. They provide a fairly specialized service to the construction and development industry, so weren't sure what else they could do to expand their services that wouldn't take them outside their area of expertise.  When we explored their core strengths, who their customers are and what their customers rely on them for, they realized that they were already taking an innovative approach to service delivery that significantly differentiated them and provided tremendous value and possible cost savings to their customers.  They just weren't clearly communicating this to their customers in a meaningful way.   

Rather than strike out in a possibly disastrous new direction requiring new resources, the big innovation for this company was to simply recognize that what they were doing was already innovative in their industry and to just communicate this. This set them apart from their competition to very positive results. 

In the above mentioned Fast Company article, the author discusses the 'how' of innovation, such as, hosting a suggestion box or holding regular innovation camps.  These can be useful, but only if everyone is actually engaged in the process.

What really supports innovation is ensuring that you and your team are engaged in the vision for the business, are clear on the core strengths that drive the business and understand your customer.  Set up open communication channels to support clarity and engagement.  Then create opportunities for new ideas to be floated and analyzed.  The company servicing the construction/development industry mentioned above does a terrific job of this.  They host regular Friday beer and pizza afternoons where everyone is casually engaged in discussion and the question, 'what can we do better' is asked.  I believe this one 'fun' activity is what makes them a remarkable company to work for and work with and it has played a key role in their successes. 

A senior consultant with Delta Partners, Delaney Tosh, CPCC, is a Certified Professional Coach working with teams and CEO’s on leadership, organizational management, innovation and succession planning challenges.  She is co-founder of The Surge Strategies Group Inc. and facilitates the Business Innovator Labs™.  Full profile on LinkedIn.

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