5 minutos

We all agree that it is necessary to innovate within firms, including top managers themselves, but there is a general dissatisfaction in how innovation is performed.

The following is a short extract of McKinsey’s report taken from the book “Winning at innovation” by Fernando Trías de Bes and Philip Kotler:

“Executives state that innovation is very important, but the approach of the firms towards innovation can often be informal and leaders lack confidence when making decisions about innovation.”

According to these authors, there are seven main barriers that impede innovation to be brought within companies.

I would like to mention what we are doing to overcome every single barrier in the projects we develop with our clients.

 

1st Barrier: The true meaning of innovation

To begin with, there is a great lack of knowledge of what innovation really is.

In our case, we simplify the issue using a definition inspired by the generally recommended Peter Ducker: “to innovate is to create something new – in your industry – that adds value for the user” (in this presentation made by us, you can see a more developed explanation of the definition and the difference with other terms like invention, investigation or development).

This means that when we help our clients to innovate, we “push” to achieve real novelties in their industry. This doesn’t stop new improvements from emerging, which will certainly be taken advantage of. But we think that keeping this level of demand allows us to obtain more and better results of innovation.

It is also common to confuse innovation with “buying innovation” (“we are innovating because we invested in machinery of the latest technology”) or limit the possibility of innovation to just “technological innovation”, which is not right at all.

Many of the considered technological innovations are actually new ways of using the existing technology, like the famous case of Tesco in South Korea (explained in this great video). The key to Tesco’s innovation is not developing a smartphone app to buy products by taking photos of the items’ QR code. The real innovation is to take the store where the client is (in this case the subway). Once there, they take advantage of available technologies such as smartphones or QR codes.

In our case, besides actively seeking something new with the clients, we suggest searching innovations in a wider area, rather than limited only to the product: in fact, they can be product or service innovations, but also organizational, of the business model or of the processes themselves. Everything will depend on the strategic needs and demands that the top management of the company will set down.

 

2nd Barrier: Diffuse allocation of responsibilities

We solve this issue with a simple but permanent structure: the creation of an Innovation Committee (IC). A committee of 6 to 8 persons that is multidisciplinary in order to provide different visions of the same thing (purchase vision, sales, financial, etc.).  It is also multilayered or multilevel in order to have, again, different points of view, but this time vertically throughout the organization: from reception to management, going through marketing or production.

Of course, every member of the IC has to contribute and not be just a spectator.

This basic structure, whose members rotate over time, is reinforced with another “detachable” structure created according to the specific needs:

-The creativity workshops, to solve strategic issues that require innovation.

-The project teams, organized to plan, execute and launch the innovation projects.

 

3rd Barrier: Confusion between creativity and innovation

Creativity is an ability that everybody has more or less developed, that allows us to make connections that generate new ideas. But these ideas don’t, necessarily, need to have commercial or business validity.

Innovation is processed creativity transformed into business success.

We solve this confusion between creativity and innovation clearly separating their different stages of work in the projects: creativity always comes before innovation. Without creativity there is no innovation, although creativity is not a synonym of innovation: it is a necessary condition, but not sufficient.

We carry out a creativity stage to solve the strategic issues. This one comes before the stage of development of innovative concepts: these concepts in turn, result of the best ideas that arose from the creativity stage.

Subsequently, follows the management of the innovation projects -for the best concepts- and the commercial launching or implementation of those projects. To sum up, the management of innovation always comes after creativity (although, of course, we can always consider creativity a stage of the same innovation process, understanding it in a broad sense).

 

4th Barrier: The absence of a unified theory

There is no unified theory or a clear framework for action as it happens in marketing with the famous 4 P’S (product, price, place, and promotion) and the complete theory developed around it by the same Philip Kotler and others.

In our case, we work with a robust methodology that actually is a systematic of innovation management as it consists in the iterative (continuous) implementation of a sequence of stages:

Strategic reflection: provides the guidelines or the strategic issues.

-Creativity: provides good innovative ideas.

-Project selection: provides the best projects for the company, taking into consideration a balanced portfolio of projects (regarding profitability, execution deadline, risks, etc).

-Project management: provides an orderly and effective management of the innovative projects.

-Continuous advance towards a culture of innovation: allows the extension of this culture through all the organization (to achieve an ideal “everyone is an innovator, all the time”).

Many times the simile we use to describe this systematic is the one of the wheel that starts to roll (the radius can be the different stages), that gets bigger (the method is developed, it adapts to every company and improves) and rolls faster, generating more and more speed and movement (the results of the company).

 

5th Barrier: Lack of control

It is common for innovative companies not to have a clear responsibility for their innovation activity: this is “dropped” to the marketing or product development staff, design or technical office department, quality managers…

In our case, these responsibilities are perfectly assigned by means of the responsibility structure mentioned previously: the innovation committee (IC) and the innovation teams.

Indeed, once the specific responsibilities are assigned, we can control the activity. As we see that happens in any production plant, where we can establish indicators, objectives, people responsible for each objective, etc.

 

6th Barrier: Absence of coordination

Once again, the coordination between departments is solved by the IC, among other things, due to the presence of representatives of almost all the departments of the company in it, that are in charge to extend and disseminate its decisions between the colleagues of their department.

The necessary presence of the top executives and other different hierarchical levels in the IC will also facilitate extending, vertically, the decisions and activities of the IC through the entire organization.

The more information and participation of the different profiles of the organization in the decisions taken, the greater is the involvement and the coordination of the team.

 

7th Barrier: Lack of focus on the client

This problem refers to one of the erroneous beliefs that Theodore Levitt identified in the declining industries in his famous article “Marketing Myopia”. This belief consists in the obsession for R+D and referred to the danger of converting companies into efficient producers of excellent objects, before converting them into useful organizations for the client. In other words, falling in the dangerous situation of “engineers innovating for their peers”. Launching novelties made by and for- the enjoyment of- the engineers rather than for the end user. This is guarantee of an assured failure.

In our case, we solve this barrier in the initial stage of strategic reflection: focusing very well in which businesses we want to work on, with what clients, acknowledging which are their main needs and problems. All this will establish different business strategies that require, to be implemented, a number of key assignments that need to be solved through, either, improvement or innovation.

The key assignments that require specifically innovation, are the ones we will take to the creativity workshops to produce innovative ideas to solve them.

 

Reasonable expectations

In conclusion, I must say that I felt reasonably comfortable reviewing all the barriers to innovation proposed by Fernando Trías de Bes and Philip Kotler. Because, if it is obvious enough we cannot guarantee success in all the innovations that our clients develop and launch, however, we can state, almost certainly, that we are going to overcome the barriers that prevent us from producing these innovations.

 

 

Disclaimer: This post was published on November 20, 2013 in Spanish on the blog “Innovación con los 5 sentidos” by Javier Sastre on the following link