Innovations Management
Innovation management is a combination of the management of innovation processes and change management. It refers to product, business process, marketing and organizational innovation.
Innovation management includes a set of tools that allow managers plus workers or users to cooperate with a common understanding of processes and goals. Innovation management allows the organization to respond to external or internal opportunities, and use its creativity to introduce new ideas, processes or products. It is not relegated to R&D; it involves workers or users at every level in contributing creatively to an organization’s product or service development and marketing.
By utilizing innovation management tools, management can trigger and deploy the creative capabilities of the work force for the continuous development of an organization. Common tools include brainstorming, prototyping, product lifecycle management, idea management, design thinking, TRIZ, Phase–gate model, project management, product line planning and portfolio management. The process can be viewed as an evolutionary integration of organization, technology and market by iterating series of activities: search, select, implement and capture.
The product lifecycle of products or services is getting shorter because of increased competition and quicker time-to-market, forcing organizations to reduce their time-to-market. Innovation managers must therefore decrease development time, without sacrificing quality or meeting the needs of the market.
The key aspects of innovation management
As virtually any new development in the organization can be considered to be related to innovation, it can be quite difficult to grasp what innovation management means in practice.
Through our experience in helping organizations with their innovation activities, we’ve found that the simplest way to understand the topic is to break it down and discuss each of the key aspects related to innovation management separately.
- Capabilities
Capabilities is an umbrella term used to cover the different abilities and resources the organization has for creating and managing innovation.
The capabilities aspect revolves primarily around people, as innovation relies heavily on the abilities of both individuals and teams collectively. It refers first and foremost to the abilities, unique insights, know-how and practical skills of the people working for the organization. However, it also covers areas, such as the information capital and tacit knowledge of the organization, as well as their other resources and available financial capital, all of which might be required to create innovation.
- Structures
The difference between structures and capabilities is that structures enable the effective use of the said capabilities.
In practice, this means the organizational structure, processes, and infrastructure of the organization.
For example, without the right communication channels, the right processes for making decisions, and the right infrastructure for implementing ideas, very few of the ideas that people are coming up with will actually see the light of day. This is where tools, such as innovation management software, can make a difference.
Organizational structure is one of the keys here. If every new innovative initiative is forced to go through the same chain-of-command and same processes as minor changes to the existing organization, it’s very likely that many innovations will be smothered.
Teams working on innovation need to be able to move fast and adapt to their environment, as well as make decisions independent of the traditional ways of doing things in the organization.
So, don’t try to force the same rules and processes for everyone in your organization. Economics of scale simply don’t work when it comes to innovation.
Structures can also be used to reinforce (or if done poorly, erode) the culture of the organization, which brings us to our next aspect.
- Culture
If structures allow the effective use of capabilities, culture is what enables the organization to acquire the capabilities related to people.
With the right kind of pro-innovation culture, the organization is much more likely to be able to recruit and keep the right people in the organization.
An appropriate pro-innovation culture encourages the right kind of behavior and discourages the wrong kind. As the effects quickly cumulate, culture can make a tremendous difference for the innovativeness of an organization. Here are some of the more commonly accepted traits for an innovative culture:
- Emphasizes the need to always think of ways to get better
- Values speed, learning and experiments
- Considers failure as just a normal part of the process for creating anything new
- Provides enough freedom and responsibility and is led primarily with vision and culture instead of a chain-of-command approach
- Strategy
Strategy comes last but not least. Simply said, strategy is the organization’s blueprint for long-term success. But it’s crucial to realise that, in the end, strategy is about picking one of many workable possibilities with the highest possibility of “winning,” and that this decision shouldn’t, obviously, be made independently of the implementation.
Though the relationship between innovation and strategy is extremely broad, at its core, innovation is just a tool for attaining your strategic objectives. Of course, there are instances when “accidental” innovation might disclose unmatched prospects that could be significant enough to warrant a complete change in strategy, but these are very uncommon and almost hard to anticipate.
The goal is to match your innovation efforts with your strategy, although this is sometimes easier said than done. It is for this reason that enhancing it is seldom an easy task with a clear answer as all four variables have an impact on the organization’s capacity to innovate and manage innovation. It’s critical for you to be able to comprehend both the overall picture and the specific parts of innovation if you wish to manage it effectively.