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Assuming your organization has a creative mindset, and beyond the possible implications of emerging technologies, a key challenge lies in pinning down what is required from an organizational perspective for innovation to take place. To a large extent, this is the key challenge in the business world today and something that many organizations, especially larger ones, struggle with. What are the prerequisites for making innovation happen?

As part of my work with Ericsson and a recent study we conducted, we identified 5 ways to master the new innovation game. These are:

  1. Insight: Understanding people and understanding the problem
  2. Outsight: Keeping track of the world around us
  3. Innovation vision
  4. Culture as fuel for innovation
  5. Structure for creativity

Let’s look at them one by one:

Insight: Understanding people and understanding the problem

A key viewpoint that most creative thinkers will agree upon is that innovation is essentially about understanding human beings. The problems that are supposed to be solved by a structured innovation approach are ultimately human, not corporate. To identify the real problems and pain-points requires an understanding of humans in their natural habitat. Some innovators and entrepreneurs have a natural eye for the world and people around them and make the problematization and analysis by default. But in most cases, innovation requires an explicit and structured research effort of going out in the real world to gain insights that become relevant platforms for innovation.

Innovation also requires fundamental understanding of the problem you want to solve – and innovate based upon this understanding. This perspective stems from the notion that innovation is about solving real-life problems for people and digging deep into what these problems actually mean. Prehype, a New York-based venture development firm, believes that a good long problematization phase is the heart of all innovation. Nicholas Thorne at Prehype says:

“We focus our time in problem space rather than in execution space. If you get the problem right the solution presents itself.”

Outsight: Keeping track of the world around us

Innovation not only requires a solid understanding of end users, it also requires keeping track of how the world at large is changing and which implications this will have on our culture in general, and your area of business specifically. To a great extent, innovation is a question of timing and being in sync with the world around.

People and companies that are in tune with their times and have a sense of what the next big thing is will likely time their innovations relevantly, while people and companies that don’t have that outsight will waste and spoil good ideas and inventions because they don’t understand the larger sociocultural and socioeconomic context.

Innovation vision

Frederic Laloux describes how we are entering an era where organizations are increasingly driven by missions, and employees are motivated by the unique user value that they can help provide. Successful innovation comes from coming up with ideas that fill real needs and serve a purpose. In other words, this emphasizes the importance of having a clear vision for why and what we want to innovate. There are many examples of leaders who embody a vision which sparks innovation by giving employees a strong sense of purpose.

Open, flat and decentralized organizations with a creative and playful organizational culture also require a more visionary leadership. These types of organizations are made up of talented, skilled, and independent people with their own drive, who usually respond best to visionary leadership. They work most efficiently when working towards a bigger idea – a vison or a mission – that brings meaning to their work and daily tasks.

As discussed in Ericsson’s 2013 Networked Society Lab Report: Moving Fast and Breaking Things – a tale of digital business transformation, the product organization is an answer to this. The product organization is made up of a number of product-focused teams that are allowed to operate very autonomously within the organization, as long as they work towards the overall vision or mission of the organization. The role of the leader is to promote, uphold and manage the vision rather than micromanage various projects.

Culture as fuel for innovation

Culture is a core focus for organizations that aim to be at the forefront in terms of creativity. The old maxim “culture beats strategy” could actually be rephrased as “culture is strategy”. Culture plays a key role in addressing the challenge of gluing teams together and making them committed to the company mission. Creating a strong community is prioritized as a strategic way of attracting the best employees and to motivate them to spend time in the office. But culture is equally as important as a strategic way of creating an environment where innovation will thrive. The idea is that innovation can occur at all times and at all levels of the organization, given the right cultural climate.

Innovation is as much a human story as it is a story about technology. Organizational culture, people and diversity are at the heart of any discussion on innovation – and the cultural aspect of innovation was highlighted by almost everyone interviewed in our study. The argument is that companies that are able to create a certain kind of organizational culture will see innovation emerge from within the organization with much less effort than in other organizations. An innovation friendly culture will be able to manage, value and prioritize ideas that show up in the organization rather than dropping them before they are even tested and tried. Some thinkers on innovation go as far as to claim that innovation equals culture.

Structure for creativity

For the longest time there was a bias towards viewing innovation as something that just happens in a “magical” way in a black box of creativity. But even if innovation can sometimes happen accidentally, the opposite is usually true for truly valuable innovation to happen. In the academic world, innovation is often described as a systematic management process and an organizational structure, rather than a black box of creativity that occasionally generates innovative ideas with real business potential.

Academic research on innovation in organizations suggests that innovation should be managed strategically from the top level of a company. Companies should have an organizational structure that enables innovation and allows people who work with innovation to pursue careers in innovation. Companies should have a defined process for how to drive innovation within the organization, and should be able to measure and follow up on their innovation efforts just like they do in any other department of their business.

There are many different ways of perceiving how a structure for creativity is best achieved from an organizational perspective, but a common theme is that there has to be a structured process for collecting, evaluating and implementing new ideas. Without the process in place, the understanding of end users and the world they live in, the visionary leadership and the culture of innovation will not succeed in creating strong and meaningful innovation. When ideas are not acted upon, the creative force will eventually fade and the culture or vision will not be enough to encourage continuous innovation.

Like this post? Don’t forget to check out the firstsecond and third at Ericsson Big Ideas Blog