While a structured innovation process can help organizations focus and manage ideas from creation through incubation to activation, most companies indicated that they don’t have a structured innovation process or framework in place. The reality is that structured processes can become overly bureaucratic and organizations need to strike a fine balance to avoid process paralysis.
An innovation process helps focus an organization’s investments on viable opportunities to create and capture economic value for the business. It provides an operating model and framework to validate innovative ideas and manage investment risk and helps properly evaluate partnering opportunities.
Having a full or partially defined innovation process separated those organizations with ambidextrous capabilities from those with neither explore nor exploit capabilities (although a number of ambidextrous organizations did not have structured processes).
Does your company have a well-defined and structured innovation process and decision-making framework that is followed?
EY’s Innovation Framework
Large organizations tend to have the size and scale to invest time, money, and effort in driving an innovation agenda. Sometimes they even have dedicated leaders and budget. Smaller companies also tend to be focused on innovation because it often enables rapid start-up growth, eventual IPO or sale to a larger company. While they might have a similar focus, the challenges they face are different. Larger companies must guard against bureaucracy and enable their employees to create. Small companies need to find ways to commercialize their ideas and generate investment support.
Implementation and culture are harder than they may seem
Implementing innovation is the area of greatest concern and listed as the biggest challenge by 59% of organizations of various sizes, in a number of industries. In the power and utility sector, leaders are most concerned about developing the right innovation operating model, while organizational culture is at the top of the list for leaders of companies with 5,000 to 10,000 employees.
There is an association between the organizations viewing implementation as their biggest concern and those who said their organization is not able to exploit innovative ideas. Leading-edge innovation ideas are worthless in the absence of a well-planned and executed implementation approach, which ultimately drives outcomes and value for the organization.
Which top three areas as it relates to innovation are of the greatest concern to you?
Process: key success factors
- Create effective processes for knowledge gathering and dissemination, idea generation, prototyping and development, and implementation.
- Define process execution structure to manage innovation projects.
- Determine support requirements, including technology and administration.