What is Innovation and Why It Is Important?
Innovation is the process of connecting new problems to new solutions.
Innovation begins with the idea of change, which could be anything climate change, health change, social changes, financial change, etc. Change leads to market pull, which are customer demands like new medicines, new cars, better education, etc which cause new sets of problems which the organizations have to deal with. Secondly it produces a technology push, inventions, batteries, gamma rays, etc which generate new solutions such as electric vehicles to reduce carbon emission a problem caused by the pull in customer demand.
In order to connect the new problems with new solutions, the organization must innovate which once again causes a change in the organization and the cycle restart.
Innovation is not concerned with old things and in particular new problems and new solutions. Innovation fundamentally as far as organization is concerned is about generating novel solutions.
There are several reasons why innovation is important to organizations and even to countries/governments.
When we are competing with other organizations we must increment ahead to earn the competitive edge and it is the only way to meet the ever increasing changes in the society.
To improve results, we must keep adding the input but the law of diminishing returns tells us that at one point the results stop increasing even when input is increasing. So it is important to add innovation at various points of inputs by introducing new ways of working or new solutions to have increasing output and overcome the law of diminishing results.
What Parameters Determine Innovation Success?
There are 4 stages of innovation success: Inputs, Process, Output and Outcomes.
Outcomes are the business performance and inputs are the three things in organization: the people, the structure and the organizational culture. The process is the thinking tools and the methods the organization has.
The things that are really important to innovation are the inputs. The results don’t determine the innovation they only tell you after innovation whether you have succeeded or not. The 4 Ps: Person, Press (pressure of innovation), Process and Products (outcomes/outputs) framework is the fancy ways of describing the inputs.
Person is who does the innovation in the organization. Everybody in the organization should be responsible for the innovation in the organization. The kinds of things that help people to be more innovative are: Openness to new ideas, Tolerance of uncertainty, Motivation and Willingness to take some risks.
The thinking process people employ in the innovation process is also very important to enable innovation success. When there is a problem we must find a lot of ideas to find solutions and use these ideas to get best solutions. This comes with divergent thinking and then implying the solutions.
Product in innovation is a tangible product you can hold in your hands but in innovation it could also be something about how we do things. Innovation products can also be represented by different collection of complex hardware and softwares as well as it could be something intangible such as service.
Based on this framework we must analyse wether the products are actually innovative or not. We must asses the products to understand wether they are new and they do what they are suppose to do. We must consider its relevance and effectiveness, novelty, elegance and genesis when analysing these products.
Press is the organizational culture and three things that are important to organizational culture is people should have sufficient time, adequate resources and active support from management to innovate.
Innovation contains a number of paradoxes, the idea that something can be both good and bad for innovation depending on the phase we are taking it. When we are involved in the process of idea generation we must think divergently and when in the process of illumination we must think convergent. The innovation Phase Instrument which is use to determine the success of the innovation need two measuring instruments: A big picture instrument to understand overall capacity and detailed instruments to drill down to 4 ps. The Innovation Phase Assessment Instrument (IPAI) allows us to diagnose an organisation’s alignment to the ideal conditions, driving improvements to weaknesses and maintenance of strengths.
In summary, organizations who innovate successfully, measure the right things which are the people and the culture at the right time and foster the changes in the organizational culture and people which can maximize the potential for change.
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