Why is innovation so difficult?

One of history’s greatest creative geniuses, Steve Jobs, passed away on October 5 2011. He was a legend already while alive. Jobs showed us that repetitive disruptive innovation was indeed possible and he built on that continuously during the last years to make Apple one of the world’s most successful companies it is today. How come he was able to achieve this while other companies struggle?

Lets start by looking at some innovation myths that makes innovation seem easier than it actually is: First of all, many people associate innovation with idea generation. The sad truth is that ideas are only the first part of the formula. The much more challenging part is the other side of innovation: implementation. Many companies fail at innovation not because they don’t have the right ideas in place but because they fail to take these ideas all the way to the market.

True “human believers” say that as long as you put the right leader in charge of innovation, the initiative will never fail. Of course having the right people in the right place is crucial, but in this case you are only looking at the “right people” part. What if the place is not right? However great this leader is, he/she is meant to fail in this environment if it is not built for innovation.

People also tend to believe that innovation is unmanageable chaos and that you shouldn’t even try to structure it because that will kill it. The truth is that if innovation is not closely and carefully managed, it will be diluted into the daily operation that is the much bigger and important part of the company. In fact, structure is seldom a problem in any situation, human beings feel much more comfortable with structure and they tend to be more efficient when a good structure is in place.

Companies talk a lot about wanting to create an “innovation culture” and “building innovation into their DNA”. While this may seem ambitious but completely doable (at the end of the day, companies like Apple, Google and Toyota have done it) – why is it so hard to achieve? The truth is that companies are not built for innovation; they are built for short-term performance. You must be able to show good numbers in the next quarterly report. Therefore, everything in the company is adapted to that; leadership, decision-making, processes etc. Certainly we have upper management whose task is to secure that the company is viable in the future and they analyze the future and develop long term strategies, but the majority of the organizational pyramid does not function like that. The fact is people in any organization are very resistant to change. This is completely natural as they are measured on their daily operational performance. We wouldn’t have had such a competitive market that we have today if companies didn’t focus on efficiency and continuously producing a bit better, faster and with less cost.

This leads us to the most important question: how do we overcome these difficulties and make innovation a natural part of our daily lives? First of all, a clear innovation management structure should be developed, including top-management participation, a clear budget, a clear reward & recognition system etc. Think about it as if you were setting up a new project portfolio – you need to be able to choose the right ideas among (hopefully) the many ideas that will be generated, assign leaders to each initiative and setup a team to implement this. Top management need to secure resources so there must be assigned time as in all other projects. One of the common mistakes companies do when they setup an innovation system is that employees never have the time to work on innovation initiatives.

Now you probably ask yourself; so what’s the difference between managing a “normal” project portfolio and managing an “innovation” project portfolio? Well in my mind, not much when it comes to the overall structure, mostly the content would differ. Of course you need an idea generation system in the background and I would say that working with innovation projects, you shouldn’t be strict on the scope – work with agile methods and let the solution gradually form. Having a separate innovation project portfolio ensures that we run these initiatives partly outside the daily operations (that would normally destroy change initiatives) and it gives innovation the right focus and the right structure it needs to fully blossom.

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