The crucial role of an innovation strategy


Written by Richard Kennedy, Chief officer, Whitespace

Despite significant investments in time and resources, many companies continue to grapple with the challenges of innovation. Countless initiatives fall short, and even successful innovators struggle to maintain their momentum, as illustrated by the stories of once-giant companies like Polaroid, Nokia, Sun Microsystems, Yahoo, and Hewlett-Packard. The reasons behind this struggle run far deeper than the commonly attributed failure to execute. At the heart of the issue lies the absence of a vital component: an innovation strategy. 

A strategy, in essence, embodies a commitment to a cohesive set of policies or behaviours aimed at achieving a specific competitive goal. Effective strategies foster alignment among diverse groups within an org, providing clarity of objectives and priorities while channelling efforts towards them. Companies often define their overall business strategy, outlining their scope and positioning, along with how various functions like marketing, operations, finance, and R&D support it. However, at Whitespace we’ve observed a lack of strategies explicitly designed to align innovation efforts with broader business goals. 

In the absence of a dedicated innovation strategy, attempts to improve innovation can become a haphazard collection of widely touted best practices. Decentralising R&D into autonomous teams, nurturing internal entrepreneurial ventures, establishing corporate venture-capital arms, pursuing external alliances, embracing open innovation and crowdsourcing, engaging with customers, and implementing rapid prototyping are just a few examples. 

While these practices are not inherently flawed, the real challenge arises from understanding that an organisation’s capacity for innovation is intricately woven into an innovation system—a coherent set of interdependent processes and structures that dictate how the company explores novel problems and solutions to transform ideas into viable business concepts and product designs and selects which projects to fund. 

Each individual best practice involves trade-offs, and adopting any specific approach necessitates complementary changes throughout the entire innovation system. A company lacking an innovation strategy struggles to make these critical trade-off decisions and fails to harmonise all the elements within the innovation system effectively. As a result, the pursuit of innovation becomes a disjointed and frustrating endeavour. 

To break free from the shackles of stagnant innovation, companies must recognise the indispensable role of an innovation strategy. A well-crafted strategy not only brings coherence to the innovation system but also helps in making informed decisions regarding which practices to embrace. By aligning innovation efforts with the broader business strategy, organisations can pave the way for a more purposeful and successful journey towards innovation excellence. With an innovation strategy at its core, a company can harness the full potential of its creative capabilities and create a resilient foundation for sustainable growth and competitiveness in an ever-evolving marketplace.

Read More Innovation

Comments are closed.