Defining Strategic Innovation
A deliberate and systematic process and capability to thrive in increasing uncertainty and long term value creation in the form of growth, differentiation and sustained competitive advantage.
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Like most things, innovation can be defined differently and mean different things to different team members and companies, whether in its definition, focus area (such as incremental or disruptive, product or service etc) or application. Therefore, saying we need to innovate more, often leads to many false starts and shortfalls.
Often, to maximise the chance for success, time needs to be invested upfront first to define at least an initial purpose and focus areas for your innovation-related efforts. If the focus is to look holistically at innovation, I will often explore and define strategic innovation for an entity.
As with all business disciplines, "it depends", but I typically start by defining Strategic Innovation like the following:
Strategic Innovation is a deliberate and forward-thinking discipline and capability to create and sustain net new value by systematically identifying and capitalising on opportunities for the long term and aligned to long-term imperatives.
It involves strategically deploying creativity, resources and expertise to develop and implement novel strategies and solutions that drive sustainable growth, competitive advantage and positive impact in the marketplace.
At its core, Strategic Innovation will often involve key things such as
envisioning the future,
challenging the status quo and existing assumptions, and
proactively shaping an organisation's trajectory to thrive in increasing uncertainty.
Regardless, it will build you a portfolio of strategic options aligned to your long-term objectives and immediate and strategic challenges.
Options are identified by exploring and discovering opportunities in changing market dynamics, industry trends, consumer and competitor behaviour, and advances in technology and science, as well as looking internally into your capabilities, commitments, and constraints.
Only some options will be viable, executed or even successful; however, balancing your innovation agenda and core operational priorities can determine the optimal timing and pathway to maximise the best chance for an option's success.
As the options executed may push boundaries, challenge the status quo, and be an unproven pathway, may not fit easily into the organisation's existing operating model, policies, and apparatus. Therefore, the capability to execute strategic innovation must also manifest in how the operating model, apparatus, and enablement functions (e.g. Risk, Legal and Compliance) adapt and adjust to the ad-hoc, non-conforming and unproven.
Strategic innovation is not just about one's ability to create and identify ideas but also about the ability to execute and adapt to make those ideas a reality and have a meaningful impact.
The above is only at a high level and is one of many potential starting points that can help with prioritisation methodologies, forming focus areas and success and performance measures.
How have you or your companies defined innovation to maximise its potential for success and value returns for your unique circumstances?
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