By Brandon Pemberton, Point B
Why are executives dissatisfied with their companies' efforts to innovate? The problem, and the solution, is all about execution — how to put innovation into action.
It's an exciting time to be working on innovation. Strong public markets, rapidly developing technology, and fierce competition across all sectors are driving massive investment. New products, services, experiences, and processes are top of mind for leaders, getting the attention of C-suites and boards. To compete, companies have no choice but to innovate. Leaders are finding the success of the businesses and their personal trajectories is now closely tied to their ability to quickly translate innovative ideas to operable concepts that deliver transformational outcomes.
This new dynamic can be uncomfortable. With greater visibility within organizations and higher levels of scrutiny, the pressure to demonstrate returns on innovation is extreme — and executives are dissatisfied. According to an Arthur D. Little report, Systematizing Breakthrough Innovation, fully 88 percent of companies are unsatisfied with the outcomes of their innovation investments. A bevy of other executive surveys show similar results, as do conversations with executives at Fortune 500 companies with the universal response being results take too long and outcomes don’t resemble the original intent.
Some common reasons for the disconnect between innovation and impact include:
The dynamics that jeopardize success can be addressed by filling organizational and operating gaps and by making small changes in how innovation, execution, and leadership teams think, the tools they use, and the activities they prioritize.
The solution rests in four categories of activities that cover the execution lifecycle. Some are probably already being done, some can be executed with little effort, and others require a harder look at how the organization is working. However, none require major change in the organization or for people responsible for delivering a return on innovation.
Prepare For Success
Success is built on strong, clear leadership alignment and support which sets the direction for the organization. Leaders need to come together on expected outcomes and commit to communicating their support. Be sure to secure resources by having the right people, processes, and technology in place for execution. When trade-offs must be made, adjust approach and expectations accordingly. Then determine the impact of internal and external factors on timelines. The success of execution is affected by what is happening both inside and outside the organization.
Develop The Infrastructure To Execute
To ensure you have the right infrastructure assemble cross-functional teams, ensuring all functional stakeholders are “in” during the initial stages of execution and have their leadership's commitment to support the initiative. Develop hypotheses. Successful execution takes a clear vision of the behavior you want to see, its impact on the organization, and what is required to deliver those behaviors. And craft a learning plan. Such a plan provides execution teams with a roadmap for testing hypotheses in a way that allows organizations to plan for required resources and understand timeline expectations.
Nail The Details
Test and iterate by engineering pilots to learn rather than to launch. Rooting them in iteration allows for continuous, efficient improvements that lead to desired outcomes. Use a learning plan to make many small pivots to concepts and their execution while avoiding wholesale changes that impede speed or the precision of outcomes. And know when the organization is ready to launch. A realistic, continuous assessment of organizational readiness during the testing phase helps ensure execution does not stumble in the last mile.
Ensure Lasting Outcomes
Operating team involvement during pre-launch activities helps ensure a smooth transition from innovation teams. Abrupt hand-offs jeopardize success. It often takes time for financial planning and analysis functions to integrate new activities. Interim monitoring functions can be tailored to the innovation to meet the unique assessment needs of new operations.
The “how” of innovation doesn't happen overnight. Organizations that are innovation leaders hone their competencies and capabilities over time. The execution lifecycle described above provides a general roadmap for putting innovation into action. However, the actual activities and focus for each organization depend on the types of innovation they want to develop, together with their existing capabilities and the maturity of their execution teams. It's all connected.
About The Author
Brandon Pemberton is a principal with with Point B, an integrated management consulting, venture investment, and real estate development firm. He has over 20 years of experience in executive operating and advisory roles related to the development and execution on new business strategies, products, customer experiences and store concepts. In these roles, he gained extensive experience in leading and establishing successful operations for: product development, marketing, sales, operations, supply chain, and manufacturing.