Are Your Innovation Efforts Working Against Your Business?

By: Ellen Di Resta

The ability to develop breakthrough products and services has become the holy grail of innovation. However, many companies struggle to develop breakthroughs even though they may be very innovative in other ways. Could it be that a different organizational barrier exists that is specific to breakthrough innovation? Examining the purpose of innovation relative to the purpose of your business may provide the answer, suggests Ellen Di Resta, Founder of Synaptics Group, Inc.

Due to the reality that increasing levels of reliability and efficiency are no longer the guarantee of competitive advantage they once were, the ability to develop breakthrough products and services has become the holy grail of innovation.  However, the fact that a company is highly innovative in all other aspects of their business is no guarantee that they will be able to successful at developing breakthrough products and services.

Could it be that a different organizational barrier exists that is specific to breakthrough innovation?

The purpose of Innovation

Examining the purpose of innovation and how it relates to the purpose of a business enterprise brings a different issue to light.  While an individual or small group of people are able to create a breakthrough product or service idea, a business enterprise is usually necessary to produce the offering at scale, reliably, and efficiently.  If we think about what has historically caused the creation of new companies or product categories, it has been breakthrough innovation.

If we then think about what has historically made the companies themselves successful, with a few obvious exceptions, breakthrough innovation isn’t at the top of the list.  Sure, the company could have been created because of a breakthrough innovation, but once formed most companies owe their success to their ability to optimize their processes.

We can see then, that the purpose of innovation is to identify opportunities to create competitive advantage, and the purpose of a business enterprise is to bring products and services to market reliably and efficiently.   When these two purposes are aligned, it is easier for companies to innovate successfully.

For example, incremental innovation initiatives typically consist of improvements to what is currently being produced. The new offering can be clearly defined, and benchmarks for success already exist.  The same is true for process innovation, regardless of how radical the new process may be.  In these cases, the purpose of innovation is aligned with the purpose of the company; it helps the company to do a better job at what it is already doing.

Identifying an opportunity that may be unrelated to the current business is counter to the very purpose of a company’s existence

From this perspective, we can see why companies find themselves paralyzed when faced with the prospect of developing breakthrough products or services.  Identifying an opportunity that may be unrelated to the current business is counter to the very purpose of a company’s existence, presenting unique challenges that existing development processes are not prepared to meet.  In order to develop breakthrough products and services without disrupting current development processes, business leaders may need to take steps to ensure that both purposes can be realized.

Some key questions to consider to get started:

How do you define your business and its goals?

Companies can define their business goals in many ways.  For example, an automobile manufacturer could decide that their goal is to become the largest automobile manufacturer in the world.  Or they could decide that they want to be the market leader in providing ground transportation solutions.  Each business goal frames a different set of acceptable business opportunities that the company would consider.  Companies that define themselves in terms of benefits will be better able to recognize viable breakthrough products and services when they are presented.

Do you expect too much from your current product development process?

Identifying innovation opportunities and developing products are two different types of work, requiring different thought processes and skill sets.  Development teams are excellent at developing new products and improving existing products.  A different, dedicated team and process are in a better position to identify new opportunities since they function independently of existing business processes.

Identifying innovation opportunities and developing products are two different types of work

How do you assess new opportunities?

Consumer preference tests will usually give an inaccurate assessment of the viability of a breakthrough product because they require comparisons to existing benchmarks which are not relevant to a truly breakthrough product or service.  However, the validity and market viability of an opportunity can and should be assessed with contextual evaluation methods.  Companies that use different metrics to assess breakthrough and incremental opportunities will be better able to recognize the value of breakthroughs.

If you have decided that it is important that your company develop breakthrough products and services, and are experiencing roadblocks, take a look at whether this activity is aligned with your company’s purpose.  Rather than trying to turn your development team into something it is not, taking steps to align the purpose of innovation with the purpose of your overall business may yield better results.

Ellen Di Resta