In the past couple of weeks I’ve learned that two companies I respect immensely are having a much tougher time of things than I had thought.
Their names aren’t important. In fact you probably wouldn’t know them even if I mentioned them here. But what’s interesting – and for me more worrying – is that (quite separately) they have both come to the conclusion that the way out of their current travails lies in what they call “innovation”. Except it’s not.
Hang on, let me clarify that.
What I mean is while part of the answer to their problems may well be innovation, their definition of what that means within the company is flawed – ultimately preventing the manifestation of change required to turn these businesses around.
I can hear the CEO ‘rally the troops’ speech from here. “Times are hard, people. We have to tighten our belts. We have to work smarter, not harder. We need to make each Dollar/Pound/Euro go further. We have to innovate.”
But freezing salaries, downsizing departments and reducing budgets can hardly be described as acts of innovation. When most senior managers say “innovation” what they usually mean is “resourcefulness”.
Innovation isn’t something that can be bolted-on to an ailing organization one day to increase efficiencies, productivity and day-to-day business processes. Innovation can’t be bought and installed over the weekend, ready for everyone to use – or criticize – when they’re back at work on Monday morning.
Innovation is an ephemeral part of a company. It’s part of its make-up. It’s an ongoing, strategic, collectively-shared process thats purpose is to add value. Apart from the financial definition, that ‘value’ might also be thought of in terms of making customer’s lives easier, or giving staff a sense of purpose, identity and direction.
Innovation For Self-DeterminationWikipedia defines the word ‘innovation’ as “…something original, new, and important – in whatever field – that breaks in to (or obtains a foothold in) a market or society.” But in today’s world of a more-demanding, service-driven customer, I think the term needs to be defined in a more experiential context. Today, innovation is the continuous, successful process of applying a new idea within the organization that brings about an enhanced customer experience.
Thinking of it in this way you can see that, actually, innovation can be many things. It can be looking at a new audience for your products or services. It can be coming up with new ways of grouping your value offering, or of pricing, or even how you interact with your customers. It could be something as small as changing the color of your widget from blue to red, or as large as designing an entirely new product line. Innovation doesn’t have to mean ‘big’ in physical terms. But it does mean a planned, well-deployed manifestation of a purposeful strategy that has a clear set of goals in mind.
Innovation isn’t painting the employee washrooms purple, or changing the logo. However the additions, changes or enhancements are employed, they need to be made around tangibles that make a difference to everyone.
Business Innovation Changes What MattersEveryone? Absolutely. Why? Because people are a lot more savvy today than they use to be. Unless you apply change that affects areas of the business that you, your staff and your customers actually give a stuff about, your audience will smell the BS. The second they feel that this is just a cosmetic exercise, you’ve as good as lost them.
At the same time, this isn’t an isolated process silo designed to be implemented without the entire company behind it. You can’t have a Chief Innovation Officer. Everyone’s in this together.
Innovation, on its own, isn’t the answer to a company’s poor sales performance or increasingly-irrelevant product lines. So many companies let the minutiae of the process of business take over. Priorities change into adding shareholder value, instead of stakeholder value. Innovation isn’t (just) about revenue, distribution and profit.
It’s about adopting (or re-adopting) a culture of purpose and passion that lives and breathes around providing value in the mind of the customer.