Innovation: turning knowledge into money

innovation

Innovation: turning knowledge into money

You don’t have to get very far into a corporate website, mission statement or annual report these days to spot the ‘I’ word. Indeed, almost every business that wants to gain or retain a leadership position in their chosen market sectors will place INNOVATION at the heart of their strategy. But what exactly does it mean, and how do we make it happen?

In this blog, I will share some of my experiences and offer tips gained during my time spent in industrial Technology & Innovation leadership positions in Europe and the US.

What is Innovation?

innovation

Figure 1: You can think of innovation as turning knowledge into money

There are many different definitions of innovation. Most will speak of something ‘new’ or ‘novel’. However, my favourite one is that it is the process of turning knowledge into money.

I make no apologies for placing such a strong financial focus on innovation. A good idea, or even a fully developed working technology, will remain on the shelf without a customer who recognises its value and is prepared to pay for it.

Often in business people will bracket ‘R&D’ and ‘innovation’ together but in fact they are actually opposites! However, it’s true to say that they are complementary to one another. Strategically-focused R&D can become a platform for whole families of future innovative products or services. The link to business strategy is key. In the past it was often the case that organisations would commit huge resources to R&D projects and worry about how to exploit the results later.

This ‘technology-push’ approach is no longer viable. There needs to be a clear ‘market pull’ to identify future strategic R&D that will lead to genuine, commercially successful innovation.

A multidisciplinary process

Another important learning point is that innovation should not be seen as a ‘technical’ or ‘R&D’ function. It works best when owned by the entire business.

innovation process

Figure 2: Multidisciplinary teams are key

Innovation is a multidisciplinary process. It tends to thrive when organisations commit resources from Sales, Marketing, Finance and Operations to executing projects. Of course, there also needs to be buy-in at the senior leadership level.

 

Methodology for screening ideas

Another challenge is to get the balance right between the creative and mechanistic/management parts of the process. Innovation is not easy. Therefore, it is important to recognise that not every idea will make it through to become a successful new technology, product or service.

The message here is that it is important to be regularly generating new ideas. However, you must also have a methodology in place for screening them. This will prioritise those that are most likely to deliver your strategic and financial goals. By definition, this requires you to screen out those that are less likely to deliver results. It’s always better to ‘kill fast’ at the ideation stage than to risk committing significant resources to a development that ultimately does not deliver the expected financial results.

innovation

Figure 3: It’s important to screen out those ideas that are less likely to deliver results

This ideation and screening process is referred to as the front end of innovation, or ‘picking the winners’.

Most companies that are successful at innovation will have a formal business process to take those ideas through to completion. What’s more there are several software packages available to help with this.

 

What comes next?

Typical stages after ideation are: scoping, building the business case, development, testing and validation, prior to the all-important launch. These process stages require quite different skills. This is why it’s necessary for all parts of the business to actively contribute to the innovation process.

The power of collaboration

Something that has changed significantly, and definitely for the better, during my time in industry is the willingness to collaborate with others. This is now referred to as ‘open innovation’. I’m a great believer in the power of partnerships to accelerate the pace of innovation. By definition, innovation requires an organisation to do things it hasn’t done before. However, chances are there will be someone out there who can help you reach your goals more efficiently and effectively.

Reflection

innovation

Figure 4: Take time to reflect, but don’t rest on your laurels!

Having gone through the entire process and taken a new development through from idea to launch, it’s now time to reflect and recognise that success. But don’t put your feet up for too long before getting back to delivering the next wave of projects. After all, innovation is a journey, not a destination!

At Innoval we’re very well-placed to help you develop and deliver your innovation strategies. As well as having the technical expertise, we have decades of experience of leading cutting-edge development projects.

If you’d like to explore anything in this blog further, please drop us a line.

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Mike Clinch

Mike is a Senior Consultant and our Materials Development Group Leader. He has over 25 years of experience in industrial R&D, aluminium alloy product development and process optimisation.

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