Before the influx of technology and globalization, corporations just had to craft one successful product in order to strike gold and continue expanding their enterprise. But solely improving on existing products and business models is no longer enough.
Nowadays, startups can easily reimagine a product or service and outperform even an established market-leading corporation. We’ve seen that in companies like Xerox, Kodak, and Nokia. These corporations were able to pioneer technologies, and yet were unable to maintain their top spot.
It’s clear that innovation lag can mean the difference between being a Fortune 500 company to falling behind.
The importance of innovation is not lost on companies. In fact, Forbes mentions how a PwC survey found that 97% of CEOs consider it a top priority. And yet, almost all leaders (94%) are unsatisfied with their current innovation measures.
What makes corporate innovation difficult to achieve?
Here’s a number of reasons:
Corporations enjoy success because they’ve undoubtedly done something right. While a successful model should be celebrated, it can hinder innovation if the company just focuses on that model and neglects new trends for the future.
When a company finds a successful business model, the management is usually tasked to exploit that advantage to the fullest. That means all the operations, processes, and resources are focused on what has always been done.
This is not to say that you don’t nurture your successful model. It’s just that when you become too focused on exploiting current advantages, you usually lose sight of your business’ lifecycle. Since every business model has a certain lifecycle, you might not be able to move on to the next innovation strategy in time before the inevitable conclusion of the current one.
Again, if a company is organized around a successful business model, it’s pretty hard to implement a new innovation strategy. A company building a corporate innovation measure will probably fail if its very own structure cannot absorb the innovation and scale it properly.
This may explain why corporations like Xerox were unable to implement the business models that the current market demanded. Even though they had the resources and foresight to change, their rigid internal structure impeded their progress.
Any Change Is Tough
While leaders and managers understand the need for innovation, awareness is only the first step. It’s another to actually implement the necessary digital unit, structures, and processes for innovation—on an ongoing basis!
Indeed, now more than ever, corporate leaders are challenged with how to be actively involved in making structures agile in order to support innovation. It’s definitely easier said than done.
A company building a culture of innovation should strive to empower employees to innovate.
Many firms today have yet to embrace corporate innovation initiatives which enable them to respond to the challenges of an ever-evolving landscape. That’s because they fail to leverage their most important asset—their employees.
Research shows that nearly 35% of employees feel that the sharing of ideas within their team is frowned upon. Often, managers don’t encourage their people to come up with new ideas or take risks, fearing that it will distract them from their daily obligations. However, collaboration is pivotal to the success of innovation.
Internally establishing such a culture will profoundly benefit a company. But firms must also learn to collaborate with other people outside of the company. They must become a part of a digital unit, an innovation ecosystem where customers, industry partners, and competitors work together to drive innovation forward.
As mentioned earlier, managers have the tendency to be unsupportive towards their colleagues. Sometimes, they are so engrossed in their own obligations that they fail to see other problems clearly. When that happens, innovation slowly becomes out of reach. Employees might not always want to speak up and counter the views of their manager. As a result, this makes it harder for the team to select the right innovation projects.
It’s therefore imperative for companies to implement the right tools and processes that empower every single person in the company to speak up. Everyone—from the Chief Executive Officer to the interns—should have the opportunity to be heard. Anyone can have a game-changing idea! So be sure to create a safe space where an idea’s worth isn’t determined by the employee’s position in the company.
Lack of an Innovation Strategy
Unfortunately, bright new ideas and a positive attitude won’t be enough to innovate successfully. You need to develop a creative process which sets the standards and direction of innovation in your company. Employees can refer to that when coming up with innovative ideas. Without it, your people might pour all their energy into creating something that the company won’t need. Don’t let their efforts go to waste.
At the same time, a solid creative strategy will help you act on your teams’ brilliant ideas. Such systems require a bit of an investment—but it will be worth it in the end. Just make sure that your employees know that the necessary structures, digital unit, and systems are going to take time and resources to build.
Mishandling of Resources
Mismanaging company resources is one way to kill a project. Whether your ventures are related to innovation or not, they won’t see the light of day if you don’t handle valuable resources like time and money properly. If you run out of both before accomplishing your project, it’s humiliating for stakeholders. At the same time, it’s devastating for firms who want to innovate.
There are many possible explanations for the untimely depletion of resources, including poor hiring choices, lack of communication, and the absence of stakeholder management. These are some of the most common reasons for such an occurrence. Fortunately, a company building innovation initiatives can avoid the mishandling of resources by meticulously plotting strategies and assigning a capable management team to oversee operations.
Doubt can poison any project. It can kill creativity and momentum. To bolster your confidence, you can conduct research and analysis. Planning ahead of time can also make you more confident.
Going forward, you must know that you can try to predict outcomes, but you can never be certain of what the future holds. You’ll need to learn to accept that. Whenever you’re in doubt, remember that your failure to innovate can ruin your business anyway. So work well, and come up with a solid strategy for your company!
From prioritizing existing models in lieu of high-risk innovation projects to structural and process difficulties, there are many challenges involved in innovation. Without it, a corporation is doomed to fail.
If you intend to embrace an innovation strategy, you should be aware of the challenges of corporate innovation and come up with a plan to counter them. Companies can start by establishing a strong innovation culture, where employees feel empowered to share their ideas and contribute without fear of being dismissed. Not only will it help you eliminate these tough hurdles, but it will also help your employees understand the need for innovation.
For teams looking to better navigate the risks and opportunities in innovation, there has to be consistent awareness and dialogue on how to refine strategies and drive creative and productive changes.