Few senior management teams (SMTs) actually understand what innovation means for them and their business on a day to day basis, warns Simon Derry.

Much has been said in the media about the need to innovate and how western economies are falling behind in the innovation stakes. Just look at the number and diversity of innovation articles on this web site – you would of thought that if everyone had got the message by now the need for the forum and the contributions would have dried up!

Despite these well publicized arguments and a general acknowledgement of the need to differentiate their business or service through innovation, few Senior Management Teams (SMTs) actually understand what that means for them and their business on a day to day basis! What holds companies back from what they should be doing, makes interesting, if alarming reading (but as a Brit it’s often a trait we have – looking on the negtive side of life sometimes!) Talking to clients recently the following themes came up – I wonder if they are the same near where you are:

1. Confusion with ‘creativity’ – Many senior managers’ first exposure to innovation, as a business discipline, has been attendance on a “Creativity Away Day.” Often management teams have been taken away from the business environment and encouraged to “be more creative,” to “think outside the box,” to “imagineer” and so forth. Often, they have been involved in role-playing and have been taken way outside their comfort-zone. The result is that many managers are frightened away from the whole concept of innovation and creativity as business disciplines.

2. Innovation is about big ground-breaking ideas – Companies wishing for that new technological leap that will jump them from obscurity into the Fortune 100 group are ignoring most of business history. Even those companies with a new technological head-start have had to work at it. Companies who wait for the next big thing while carrying on as normal will fulfil Gary Hamel’s prophecy: “Those that live by the sword will be shot by those that don’t.”

3. Our “creative types” in the marketing and R&D departments “do” innovation – The most innovative companies realize that everyone should be involved in innovation. How many times have we heard the mantra that “people are our greatest asset.” Really! If you truly valued them then you would involve them in the innovation process – the lifeblood of the company! Actions speak louder than words.

4. Innovation was done last year/month/week – Newly appointed innovation managers see innovation as a theme that fits in with the other marketing campaigns underway in the company. This often leads to the approach “we’re being innovative in Q3 this year!” To paraphrase many business gurus, “innovation is not a destination but a journey.” It is constant and all encompassing. You wouldn’t apply the same argument to, say, finance? “We’re going to do financial budgeting next quarter” – doesn’t quite work, does it?

5. We’re a service company – innovation is about products. An excuse often given by management is that innovation is only relevant for those organizations and companies that have a product to offer. In most cases they see innovation as being focused on revamping the product. In fact a successful innovation culture can embrace all aspects of business.

These are my top 5 reasons why businesses are being held back from being truly innovative. And the critical innovation success factors? Wait for the next article…