菜单
Innovate to impact framework

This is the second article in our series that explores mechanisms for creating a sustainable innovation engine that delivers long-term business value. See Part One, Part Three and Part Four.


Every organization wants to innovate. Not everyone succeeds. And often, the reason for failure is that organizations are trying to capture lightning in a bottle. Good luck with that. Instead, we prefer to plan for success. In this article, we’re going to dive into the practical details of our fluency model — the Innovate to Impact framework — looking at each stage of the journey and outlining the steps you need to take to proceed to the next level.

The framework relies on a collaborative approach to innovation — avoiding the pitfalls of both the top-down and bottom-up approaches that so often end in frustration (see article one for a fuller description of the collaborative approach). But success demands more than just setting up a team and hoping for the best. Let’s look a little closer at how your journey towards sustainable innovation can map out. It starts with a vision: how you see ways to differentiate yourself from the competition.


Stage 1: Experimenter (Build the capability & innovation engine)


The first stage of your journey is all about building capability and the innovation engine that will help you with experimentation. Your innovation team needs to understand all key stakeholders; the roles team members will play; how to source ideas from people across the enterprise; and how to establish communication channels and build a process that will allow efficient execution of the experiments that you’re going to conduct.  


Experimentation, however, needs to be aligned to a purpose: that of getting you closer to your vision for strategic customer differentiation objective. Successful experimentation will help you scale through the steps of this framework, and smooth the path towards sustainable innovation. 


As part of the innovation engine, your team needs to get accustomed to the discipline of sourcing ideas; validating them; ensure the focus is aligned to business priorities; and evaluate experiments’ success in ways that are tangible to the business. This helps the team to be lean in their approach of building an innovation engine for experimentation. 


As part of this stage, the following are the aspects you need to consider: 


Purpose


To build the capability and set foundations to carry out experiments in the most efficient manner.


What you need to do? 


At this stage, you will need to: 

  • Identify the purpose of your innovation programme and set a long term charter for the programme 
  • Identify the key stakeholders and team members 
  • Build relations and alignment with leadership and understand strategic objectives of the organization
  • Generate, validate and select a set of ideas and experiments in collaboration with people across organization
  • Prioritize a set of ideas and run experiments using the rapid innovation framework 
  • Review your process to identify the most efficient and impactful way to build experiments
  • Repeat the process for different types of experiments to fine-tune your innovation engine


Expected outcome 


This phase is all about building an innovation capability that turn your ideas into products, prototypes or some tangible results (success or failure) in the most efficient manner. Once you’ve taken the above steps, its expected that you would have:

  • Built the team that’s capable of running experiments in the most efficient manner 
  • Understood the communication pathways and decision points within your organization 
  • Proven your capability that you can turn ideas into products, prototypes or some tangible results (success or failures) within a definite period of time 


This should invite more attention for you innovation programme and possibly enable you to secure additional funding. 


Possible risks 


One of the biggest challenges for this early-stage Experimenter team is that the projects may fail, or at least not produce the anticipated results. Maybe more experiments fail than succeed.


This can undoubtedly impact morale. So you should raise this possibility with the team at the outset. Because at this formative stage, successful projects aren’t the only goal: it’s essential that your team learns to adapt and quickly identify when projects aren’t delivering. They’ll learn far more from projects that go awry than those that are plain sailing. 


Innovation in practice


Google X is a great example of how experimentation-oriented innovation labs can be set up. X is a diverse group of inventors and entrepreneurs who build and launch technologies that aim to improve the lives of millions, even billions, of people. Its goal? 10x impact on the world’s most intractable problems, not just 10% improvement. It approaches projects that have the aspiration and riskiness of research, and tries to tackle them with the speed and ambition of a startup.

Some of its best known ideas include Project Loon (balloons to deliver internet in rural areas) and Project Wing (Drones for good deliveries).


Stage 2: Value creator (Build enhanced credibility and strengthen leadership support by targeting internal value creation) 


Once you have a solid engine that enables you to turn your ideas into tangible results and has proven its worth through a series of experimentation, you should then turn your focus onto building impact within the organization. This can be done through targeted value generation using your engine. As a part of value creator, your focus should now be to partner with important business functions within the organization, identifying opportunities where impact of innovation can be highest and partner with the users or functions to deliver those innovations to them.  


The important difference between the experimenter phase and value creator phase is that in the latter, you identify specific areas (such as recruitment, staffing or operations) and work with the end users to establish a hypothesis of value and agree on it before starting to work on solving the problem and delivering an innovation. In this phase, your working team becomes bigger as you welcome the potential users and functional people into your team and focus on co-creation to deliver impactful innovation through your engine. 


Purpose


The purpose of this phase is to strengthen the partnership with the organizational leadership by providing direct and tangible benefits to the important business functions through your innovation engine.  


What you need to do? 


To prepare successfully for this stage, you should: 

  • Identify and partner with an internal business function, which is strategically important for the organization (say staffing, recruiting, sales) 
  • Talk to the users and understand their problems, as well as opportunities in the area 
  • Ideate within the context to understand the possibilities for innovation 
  • Map idea to potential value /outcome and target specific idea for experimentation 
  • Create a working group with users and functional people that would work with your team to co-create the solution 
  • Use your experimentation engine to build the solution/product/prototype and targetedly deliver the value 
  • Measure the value delivered 


Expected outcome


Because your innovation team is now working with a target group within the enterprise, you can expect the team to hone their ability to generate ideas that solve specific problems for that team. This can help build the culture of purpose-led innovation.

Innovation is driven by customer value and market differentiation. It's sustained with strategic alignment and people participation.

The innovation efforts through this phase should directly help your organization achieve part of its strategic goals or push your functions closer to achieving their strategic goals.  


In a nutshell, deliver impact for an important business function within your organization. 


Possible risks 


The choice of targeted teams within your organization will determine your success. That’s because this needs to be a close working relationship. If your stakeholders can’t make time for, you can’t deliver.


This can be a challenge. As we saw in the first article, when business-as-usual is the priority, innovation suffers. You can’t afford to be seen as a distraction, rather than a strategic enabler.


Innovation in practice


In a commercial aircraft’s galley, space is at a premium. And with hundreds of passengers to please, every square centimeter is precious. So when looking at how to maximize use of this space, Delta Airlines’ innovation team, The Hanger, came up with an neat idea to reclaim nearly two carts’ worth of space: turning the coffee mug handles to face each other. Sometimes, valuable ideas don’t need to cost the earth.



Stage 3: Business enabler (Build customer-focused innovation engine to support sales and new client solutions) 


Once you’ve proven yourself to be a value creator for the business, it’s time to take the next step and start thinking of directly contributing to the business growth. As you start thinking of growing the impact of your innovation program, it’s important that you start thinking of impacting the sales and demand efforts of your organization and to an extent, your organization’s clients. This phase, the Business enabler, specifically targets value creation for the revenue-earning departments or in some cases, directly for the clients. 


Using the work done for building the delivery engine and value creation for internal functions, you’d have built a repository of innovations that could possibly be ready to be showcased to your clients as a part of your proposal, or a sales pitch. In some cases, there may be a need to do a targeted prototyping or concept designing for clients based on certain pre-sales activities. Your innovation team can partner with the client account teams or sales and demand teams to proactively identify opportunities to showcase your innovations to clients or create new innovations that will assist sales efforts with existing and new clients. 


This is where the focus of the innovation shifts from delivering targeted value to an internal function to target supporting business development efforts of the organization through innovation. 


Purpose


The purpose of this phase is to directly support the pre-sales, client account teams and business development efforts by targeting specific client or market opportunities to help win more business. 


What you need to do? 


To prepare successfully for this stage, you should:

  • Partner with the market-facing or revenue-generating departments within your organization to understand the opportunities 
  • Understand about the existing clients and potential clients that your organization wants to target 
  • Collaborate with client account teams and sales teams to identify opportunities where innovation bring an impact on business development 
  • Identify opportunities to showcase your innovations to relevant clients (existing / potential) as a part of sales efforts 
  • Deliver new innovations that would be relevant / showcaseable to clients (existing / potential) that would open up new business opportunities 
  • Continue aligning with the business functions within the organization to deliver concepts / prototypes / innovations relevant to the market 


Expected outcome


As part of this phase, your team is now working with the direct revenue-earning (or maybe winning) departments of the organization, you can expect the team to contribute to winning more business for the organization. This is especially true when it comes to existing revenue-generating streams. 


You can do this by supporting the sales efforts by delivering innovative example PoCs, concepts, prototypes aligned with the clients or market you are targeting. The innovations that you deliver should be targeted to help open up new conversations with existing clients for more work, innovative work and help convince new clients about your capability of delivering work.


By running experiments that are targeted towards customers, clients and the business, you should get quicker way at market and opportunity assessment. It should become second nature for your teams to know about market conditions and identify where opportunities lie.


Possible risks 


The stakes are rising. You may need larger investments for the experiments you’re running — and that’s often a business challenge. Especially because you are doing a pre-investment into delivering potential revenue earning innovations that may or may not necessarily guarantee new business. 


There’s a danger that customers may still be thinking about yesteryear’s ideas and may not be really prepared for your innovation to drive their growth. So in many cases there is a likelihood that you may present a shiny new innovation to them and they may think: “This looks great, but probably we need time to be ready for this kind of work.”


Innovation in practice


At US insurance group USSA, business enhancements are achieved by going to its customers directly. It runs new ideas past its customers via USAA Labs, where members are invited to evaluate and test new ideas and concepts. For instance, members might be asked to evaluate the firm’s process for handling natural disasters or maybe a guide for managing debt. Through its innovation process, it can run experiments that target specific value and get to production through a targeted innovation process, where it has proven customer needs.

 


Stage 4: Strategic differentiator (Define your own blue ocean and find your sweet spot, led by innovation) 


Now that you have mastered building your innovation engine, understood how to create significant value for internal stakeholders and the organization, and also mastered the art of building innovations for clients and help strengthening existing revenue streams, it’s time to take a jump and take the next step. 


To grow significantly faster, you need to create your own blue oceans and deliver differentiated value to clients through your innovation engine. You need to create a value proposition such that it differentiates you positively against your competition and potentially, makes the competition irrelevant. This is the whole point of innovation and through this phase, you should aim to create a strategic differentiation for yourself against your competition. 


Purpose


The purpose of this phase is to use innovation to build a strategic differentiator for yourself against your competition and position yourself positively in the market you operate. 


What you need to do? 


To prepare successfully for this stage, you should: 

  • Invest in R&D to understand and spot potential new market opportunities that would provide significant new value to your customers 
  • Use your market research skills to come up with new offerings, services or products for your existing customers, or to spot an entirely new customer segment 
  • Understand how this could differentiate yourself against your competition and provide you an advantage in the market 
  • Invest in building a strategic capability to support the delivery of the new offering, services or a product for your customer segment  
  • Successfully delivery value to customers and run a full cycle of acquisition, retention and growth with your customer (i.e., acquiring, retaining and growing the customer)
  • Think about building a strategic partnership with your customers and help them to graduate through their own innovation journey 
  • You can think of being successful if you are able to help customers draw significant value in the markets they operate through your new innovative offering  


Expected outcome


As a part of your strategic investment in innovation efforts, you need to create a new product, service offering or a value proposition for customers that’s innovative and positively differentiates you against your competition.  


This can be done by establishing a strategic innovation partnering with your customers and help them shape up their own innovation journey and help them deliver significant value to their customers. 


Possible risks 


The biggest risk in this is the lack of belief of leadership in investing into R&D to create true differentiation through innovation.  


It’s often seen that the leadership prefers to take low-risk approach to exploring new opportunities and it may mean that they’d miss out on creating a significant differentiator for organizations through this approach. 


This phase requires organizations to take a radical new approach and may impact culture, people and the way the business is done etc. and it needs strong and visionary leadership to take this step. 


Innovation in practice


  • Airbnb is a great example of how innovation has enabled an entire new business to be set up; one that’s disrupted the hospitality industry globally. Its unique rental platform lets people list, find, and rent short-term lodging in 65,000 cities and more than 191 countries across the globe. Innovation has proven to be a big strategic differentiator for Airbnb and allows itself to create a blue ocean for itself against the competition within the hospitality industry.


In Part Three of this series, we'll explore how this fluency model has been implemented in practice.


How can you achieve faster growth?