Innovation Perspectives – Create an Honest Crisis

This is the eighth of several ‘Innovation Perspectives‘ articles we will publish this week from multiple authors to get different perspectives on ‘What are three specific actions that a non-innovative company can take to become more innovative?’. Here is the next perspective in the series:

by Kevin McFarthing

The pressures on all companies today are increasing, and even non-innovative companies recognize it. Despite this, it would be difficult to find a company that would openly admit that they aren’t innovative. They will tick along in the same way they always have done, most likely selling commodity, undifferentiated products or services. If they continue, they will die – the only variable is how long it will take. “Business as usual” won’t change a thing. So the first specific action such a company should take is:

Be honest with yourself and generate a sense of “crisis”.

The organization needs to be mobilized, particularly at the top level, to understand the real crisis and to catalyze the actions necessary to change.

Next, most non-innovative companies are internally driven and pay much less attention to the customer or consumer than innovative organizations, who take their lead from the market place. While it’s an uphill task to suddenly become customer aware and deeply understand all the rich insights your consumers are ready to give you, the non-innovative company really must start here. If they don’t they will probably develop something new and innovative for which there is no need. So the second action is:

Undertake an intensive customer understanding program.

They should cast the net wide and not just “tick the box” to confirm existing prejudices, but instead aim for a real, objective and honest understanding of what the customer wants.

Fantastic – we now have an understanding of the customer, and we all recognize the crisis we’re in. The final action really should be taken in parallel to the second, and it relates to the core competencies of the company. Anybody with a track record that doesn’t include innovation won’t have the resources or mindset in place in the key areas of R&D, marketing, market research, business development and strategic alliances. If they need to innovate quickly, a highly motivated senior champion needs to be given the responsibility and support to examine what is needed and to put plans in place to fill the gaps. It is very likely that the fastest route to competence is to find a partner outside that already has it and can work in a complementary manner. They can provide, for example, technical product development capability, which can deliver products that can be sold through the company’s existing infrastructure. So the final action is:

Put the competencies and resources in place to start delivering innovation, whether they come from inside or outside.

The non-innovative company will now understand the situation, have engaged the customer and will have started to put competencies in place to deliver innovation. The core problem facing them won’t yet be solved, but they will have made a great start on the journey to ensure survival and growth.

You can check out all of the ‘Innovation Perspectives‘ articles from the different contributing authors on ‘What are three specific actions that a non-innovative company can take to become more innovative?’ by clicking the link in this sentence.

Kevin McFarthing runs the Innovation Fixer consultancy, helping companies to improve the output and efficiency of their innovation, and to implement Open Innovation. He has a background of innovation leadership positions in consumer products and life sciences.