What are the characteristics and success factors to innovate in the era of autonomous entities? Is your company innovative?
In 2017 with many start-ups disrupting the status quo and many established companies defending their businesses or attempting to innovate in their own way there are a lot of discussions and debates about innovation culture, organizational set-up for innovation and other relevant subjects. Although there is not one optimal approach for innovation the following attributes are key in many top innovative companies:
- They have a Transformative Company Purpose. WHY?
A Transformative purpose attracts talent, creates a community around and enables you to compete better. It is transformational in the sense that it inspires employees and other stakeholders to do great work. According to new university research the 21st century motivators are Purpose, Autonomy and Mastery and there is a need for a higher aspirational purpose that captures the hearts and minds of those inside and outside of the organization.
2. They challenge themselves being connected with communities & crowd. WHY?
Ideas get reviewed, adopted, rejected, improved faster than ever before. This means that any question requiring ‘outside inputs’ get feedback faster. Using the ‘community’ increases the rate of Innovation while the ‘right’ community will offer opportunities not considered before.
3. Embrace exponentially growing technologies + multiplication/convergence effects as enablers. WHY?
Embracing new technologies that are growing extremely fast is the only way to meet the future. What will be the result of Data Analytics combined with AI, Robotics and Virtual Reality? Not an easy to answer question and there will be amazing innovations.
4. Embrace Autonomy and Speed. WHY?
The greater connectivity and the new technologies allow for unprecedented speed of access and decision. For a company to remain competitive needs to be able to match the speed through more autonomy (people and automation) especially at the edges, close to the customers of the organization.
5. Learn faster through experimentation and fast failure is encouraged as it is learning. WHY?
The fastest way to learn is through testing of concepts with real customers. Creating final products and throwing them in the market after long creation cycles is not an option anymore. Allowing failure is key component of learning culture in order to innovate and improve the customer experience.
6. They think in multiple time scales (short, medium and longer term). WHY?
Addressing the present without losing future focus is the only way to be sustainably successful. The future and Innovation means that they need to address: Digital customer experience, Data based insights, min 10X better/faster/cheaper mindset,… invest in start-ups and accelerators, ……..
7. Question existing culture/ways we do things. WHY?
As the world is changing faster and faster many older organizational structures, processes, ways of doing things are becoming obsolete and consequently successful organizations need to innovate continuously. Existing hierarchical structures, remuneration structures, working environment set-up, employer-employee relationships are brought to question and need to be addressed. Companies that question the way they do things here/culture will innovate and thrive.
8. Keep separate the start-ups/new businesses from the established businesses. WHY?
The new business portfolio/future businesses are set up separately (within an incubation structure and start-ups are acquired to become part of the incubator) working like start-ups to discover a viable business model before they run out of cash. This approach is essential as working within a big company the start-up culture needs to be preserved. Their focus is to innovate by creating new businesses based on a new business models or develop new technologies or a combination of both.
The current businesses are focusing to delight existing customers, defend existing margin structure, grow and generate income to support the organizational objectives at large. They are normally big with established customer base, go to market channels and processes. These are major assets for an established company and any disruptor would love to have these assets. Their focus is to innovate and grow the business within their market segments and product portfolio without creating new business beyond their core. As they are normally big businesses they are not flexible enough to behave like start-ups or compete with start-ups! They focus mainly on Routine/Sustaining/Incremental Innovation.
The subject is huge and that is what I think are the key attributes for innovative companies without being the only. What other attributes do you think are important?
I welcome more comments and thoughts. How is this applicable for your company?
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Mike Mastroyiannis is Business, Management & Executive Coach and Management Consultant for among others, Transformational Leadership, New Business Models and Exponentially Disruptive Innovations. He has served as CEO of business units in Multinationals, founded or lead start-ups and serves in advisory boards. He can be reached through LinkedIn or email email@example.com