The organizations that have a good practice with employing tech innovation programs are considering moving beyond the financial returns associated with them and exploring the strategic impact these initiatives can bring in the relations with their customers, employees, partners, and industry at large. Suppose until now, the return on investment has been the principal reason behind any decision involving innovation and broad corporate commitments. In that case, organizations are now considering the many facets of value tech innovation projects can provide.
This article unveils some ideas leaders at top-performing companies consider when calculating the potential returns on the innovation initiatives they adopt, besides revenue.
Hoes does tech innovation investment align with the strategic organization mandates?
Business leaders analyze how an innovation project can align to the organization’s strategic goals based on its capabilities and the existing market conditions. Now they have access to comprehensive data visualization tools that allow them to determine how a business decision can influence its performance and understand if the innovation model makes a strategic impact. They can also use SAP Data Cloud tools to examine large ranges of datasets. The information they obtain with the help of these tools helps company leaders to analyze different scenarios and identify the measures they must adopt across various dimensions.
Does the innovation project solve any of the customer pain points?
Before integrating tech innovation into their processes, companies need to assess how it impacts the customer experience.
Before integrating tech innovation into their processes, companies need to assess how it impacts the customer experience. How do particular tools and strategic approaches address customer issues? Do they solve the problems at their root cause? Organizations use different tools to identify the propensity to invest and the effect a new tool would have on the customer lifecycle and engagement. They also need to determine if the project impacts their relations with investors and business partners. Sometimes, new innovative solutions that target the back office drive the customer experience and allow companies to prioritize their approach when deciding how they implement programs. For example, companies can use an SAP intelligence tool to identify customer service processing bottlenecks they wouldn’t be able to find without a tech tool that targets deep data.
Does the innovation solution improve or deter the employee experience?
The COVID-19 pandemic has triggered a rapid evolution of work patterns, and not all organizations were able to adapt. One of the most significant changes they had to adapt to was moving away from the office to a work-from-home environment. Companies from all industries witnessed their employees leaving their offices to work from home in safe conditions. As companies adopt new working tools and norms, the business leaders must consider how they impact the employee experience and find ways to support employee engagement. In most cases, it implies conducting targeted pulse surveys regularly to understand how their workers react to the latest implemented programs and identify any possible issue. The quicker they solve the problems, the less negative impact they have on the organization’s productivity. Supposing business leaders determine that their employees struggle to use the latest tech innovation tools, they can work with an innovation consultant like Diana Kander, who can help them identify the type of organizational culture they need to grow to ensure their ideas and programs succeed. The secret to building an innovation program is to work with a specialist who asks the right questions and challenges how the organization functions to help the leaders gain a new perspective.
Does the program provide a larger industry outcome?
Businesses are operating in a highly interconnected world that has the role of broadening their perspective beyond the walls of their offices and immediate clients. For most organizations, their social license to operate is finding how their innovative solutions and new technology initiatives affect the industry locally, nationally, and globally. Companies can use concepts like business networks to work with partners from different communities and expand their influence to achieve greater social outcomes, besides the financial revenue.
How do organizations innovate in 2021?
Traditionally, entrepreneurs have associated innovation with R&D because basic research triggers new innovations that are further patented and developed into applications. While there is still room for this kind of innovation, the Internet and technology have changed the game. Organizations have access to knowledge, information, and top-notch software and use them to solve any problem they face. In other words, in 2021, innovation is about putting the pieces of the puzzle together.
Google made famous a formula for innovation, the 70-20-10 rule. It implies that an organization should use 70% of its resources to come up with incremental innovation for the core business, 20% to expand the core, and 10% to transform its operations for the future. This is a rule of thumb, but companies exploring the benefits of innovation can use it to understand how to allocate resources to different types of innovation work. Even if they don’t have enough resources to compete with large organizations, they can take advantage of multiple innovation opportunities. They don’t need millions of dollars to innovate their customer service or automate their operations. Innovation is no longer a solution only for the companies with the most resources, but a tool all businesses can use when they need a solution for a given problem.
Kinds of innovations
There are different types of innovation, and the simplest way to categorize them is by the market impact they make.
- Sustaining innovation that offers a significant improvement on a service or product that can maintain a particular position in the market.
- Incremental innovation that offers a continuous but gradual improvement on an existing service or product
- Disruptive innovation can be a new business model or technology that disrupts the industry.
- Radical innovation usually comes in the form of technological breakthroughs that change markets and industries and create new sectors.
A company that is new to innovation shouldn’t pursue a kind that implies relying on the latest technology because they’re most likely to fail in the process. It’s a better idea to use proven technology and gradually build new capabilities required to succeed in adopting innovation.