Sunday, January 07, 2018

When should a company focus on innovation ?

While going through a couple of articles on what describes the best time to focus on innovation, I was surprised to get some very simple and startling insights on the innovation process.

No business organisation, either for-profit or not-for-profit can ever remain successful.

Given the dynamic circumstances in which they are functioning, the structures, management capabilities, strengths and weaknesses keep changing almost on a daily basis. If last year was a great time for organisations to make profits and consolidate, this year the situation may change drastically making the organisation very vulnerable and slow in growth. It is the objective of senior management in any organisation to understand the dynamic nature of the environment in which the organisation is functioning and guide the organisation through times thick and thin.

What time is the best for an organisation to embark on innovation ?

While going through good times, any organisation for that matter, would first look at consolidating it's position and increasing it's revenues. Good times are times to make profits and ensure one's consolidation of the industry. 

But when an organisation passes through trying and challenging times, for example,

1. When an organisation business is passing through difficult times,
2. when the economy of the country is in turmoil and reconstitution,
3. when the organisation is passing through times of trial and tribulation,
4. when the organisation needs to be recast from the beginning,
5. when the organisation needs to shift its operations to a virtually new land and territory or business sector,
6. when an organisation needs a recoup of its top senior management with an entirely fresh and experienced top management, 

All of these are great times to go for innovation.

As Martha Mangelsdorf notes, innovations should be able to showcase how in the first instance it can help the organisation save money while at the same time provide the same quality of service with no dilution. 

Innovation as we know, delivers great value for the organisation, innovation during these times can identify hidden sectors in the organisation where changes could be effected for the better, giving great value for all the stakeholders, not forgetting the most important stakeholder, the customer himself. 

All Innovation starts with different sectors of the organisation during their tough times and essentially ends with the customer. “Tough times present an opportunity to assess systemic weakness in one’s industry, company and leadership team,” - Prof. Schoemaker, Marketing Professor at  Wharton Business School. Prof. Schoemaker continues, "use tough times to do a self-audit" to prepare one for innovation. 

Ref :
1. Markman, Art, Innovate during tough times,, June 15, 2016
2. Mangelsdorf, Martha, How to innovate in tough times, MIT Sloan Management Review, Jan 20, 2009
3. Knowledge at Wharton, Finding money for Innovation, Develop those people skills, Jan 7, 2009.

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