The Key Stone to Success in a Constantly Changing World

Innovation has become a fundamental pillar for business success in the current era. Companies that manage to stay at the forefront in terms of products, services, and processes are the ones that survive and thrive in an increasingly competitive and ever-evolving market. For a company executive looking to drive innovation, it is essential to understand how to effectively organize this function within the organization. In this article, we will explain key tips on how to structure business innovation and ensure it becomes an integral component of the company’s strategy.

Putting the Focus on Innovation in the Strategic Plan

Innovation cannot be an afterthought or an isolated project within the company; it must be intrinsically linked to the corporate strategy. This implies that innovation must be one of the fundamental pillars of the organization’s strategic plan. Companies that excel in innovation understand that simply reacting to market changes is not enough; they must anticipate them and lead the transformation.

It is also important that this innovation aligns with the company’s mission and has a logical connection to its business. An example of this is Apple. The company has based much of its success on constant innovation, integrating creativity and future vision into its strategy from the beginning. This has allowed them to develop revolutionary products such as the iPhone and the iPad.

Innovation Department or Integration Throughout the Company: Which Approach to Choose?

The decision of whether innovation should be led by a specific department or integrated throughout the entire company largely depends on the organization’s focus and culture. Both approaches have their advantages and challenges.

1. Innovation Department:

Creating an innovation department can be beneficial if you are seeking a dedicated structure for generating new ideas and projects. This department can consist of innovation experts who work closely with other departments. This way of organizing innovation is appropriate when you need results and do not have enough time to initiate a cultural change process, which is always slow. However, you should be vigilant to ensure that the department does not become an end in itself and loses sight of its purpose.

A good example is Samsung, known for its focus on innovation and research. They have invested significantly in R&D and have multiple specific divisions focused on innovation, from consumer electronics to semiconductors. This has resulted in a wide range of successful products, including smartphones, televisions, and electronic components.

2. Integration Throughout the Company:

Innovation can be integrated into the culture and operations of the entire organization. This fosters creativity and collaboration at all levels, which can result in a greater diversity of ideas and approaches. The challenge often lies in the fact that this approach is slower and, at times, may lack small wins to energize projects. Many companies that have opted for this model have not been able to withstand the time needed for consolidation due to the pressure of business as usual. That’s why, in any case, it demands significant doses of constant leadership and high resilience from top management.

An example of successful integration is Google, which encourages its employees to dedicate 20% of their time to innovative projects unrelated to their primary roles.

Innovative Culture: Fostering Creativity Throughout the Organization

Organizational culture plays a crucial role in the success of innovation. To foster creativity and innovation, it is essential for all employees to feel that their ideas are valued and that they have the freedom to experiment and make mistakes. Here are some key strategies to promote an innovative culture:

  • Exemplary Leadership:

Leaders should be role models in terms of creativity and willingness to take risks. They should actively encourage innovation and recognize and reward those who bring new ideas. “Exemplary leadership” refers to a leadership style in which the leader serves as a role model for other team members or the organization as a whole. In other words, an exemplary leader not only directs and makes decisions but also demonstrates behaviors and qualities that inspire and motivate others to follow their example.

  • Collaboration Spaces:

Designing workspaces that encourage interaction and collaboration can be essential for generating new ideas. An open and creative physical environment can inspire employees. If you want to learn more about this, you can read my article on Collaborative Communities, a New Way of Teamwork.

  • Training and Development Programs:

Providing training opportunities in creative thinking and problem-solving can help all team members contribute more effectively to innovation. These actions can range from designing training in critical and creative thinking skills, mentoring and coaching, or organizing innovation events or hackathons, to employee reward models with innovation proposals, project management training, or promoting a culture of error as an opportunity for improvement. I will delve into this important aspect in an upcoming installment.

Ultimately Responsible for Innovation

The question of whether innovation should depend on a specific department or the entire organization also extends to the ultimate responsibility for innovation. Ultimately, innovation should be a shared responsibility. Company leaders should establish a clear vision and commitment to innovation, while innovation teams (whether a department or all employees) should be responsible for executing this vision.

Additionally, considering involving external experts or consultants in the innovation process can provide a fresh perspective and new ideas to the organization. You can further explore this topic by reading my article on How to Create an Advisory Board that Drives Innovation in Your Company.

Open innovation, which involves collaborating with external partners, can also be an effective strategy to keep innovation fluid and responsive to changing market trends. In this regard, we can highlight the example of Procter & Gamble, a company that has adopted an open innovation strategy by creating its “Connect + Develop” initiative. This initiative focused on collaborating with external innovators to develop new products and technologies, leading to the successful launch of products like the Oral-B electric toothbrush.

In Summary …

In today’s business environment, innovation is essential to stay competitive and relevant. Effectively organizing innovation within the company requires a strategic vision, the integration of an innovative culture throughout the organization, and a structure that aligns with the company’s needs and values.

By focusing on innovation in the strategic plan, deciding between an innovation department or integration throughout the company, fostering an innovative culture, and establishing shared responsibility, companies can be better prepared to face the changing challenges of the market and lead innovation in their industry.

Innovation is not a destination but a continuous journey. By following these tips and learning from the mentioned sources, executives can pave the way to success in a constantly evolving business world.

For further learning on this topic, I recommend the following readings:

“Innovation and Strategy” by Michael E. Porter.

“The New Imperative” by Henry Chesbrough.

“Innovation and Organizational Culture” by Edgar H. Schein.

“The Innovator’s Dilemma” by Clayton Christensen.

Author: Ricardo Alfaro