Innovation correlates directly to revenue.

In fact, one third of an organization's revenue today comes from products not sold five years ago. In the high stakes but essential field of organizational and industrial innovation, part II in our series looks at how some organizations are leveraging the lessons learned discussed in part I for their newly launched innovation initiatives.

With much of the downsizing or rightsizing behind them, organizations are now turning their attention toward a path for growth. Organizations aiming to improve financial performance and satisfy financial-market demands recognize innovation as the driver for achieving growth objectives. In part one of our series seen in the March 2004 issue of inKNOWvations, we reviewed a landmark study of failed corporate innovation programs (as well as the personnel casualties that resulted), and discussed some of the lessons learned revealed in the study. Part two looks at how some organizations are tackling these lessons in newly launched innovation initiatives.

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Part II - What Do We Do Differently?

Let's review some of the practices that demonstrate success today in the high stakes but essential field of organizational and industrial innovation.

1. Make innovation a part of everyones job. While some aspects of truly breakthrough innovation will always reside in the R&D labs of organizations, everyone at every level and in every function must be involved and held accountable for innovation, or it will only be motivational slogan displayed on the walls of corporate conference rooms. Many profitable, innovative ideas can be uncovered in purchasing, accounting, sales, logistics, and plant operations, as well as in the processes and methods used to engage customers, communicate internally, and plan for the future.

2. Bring the lessons forward. It is unrealistic to think that the learnings of the past 15 years will simply be forgotten as innovation efforts begin again. Despite the efforts of management to explain the new situation (i.e., the downsizings are over, we need innovation again), most team members have long memoriesoften longer than the tenure of the current CEOand past failures are discussed in the hallway but not spoken during company meetings. It is unrealistic to expect a sudden groundswell of enthusiasm upon the restart of innovation programs. People remember what happened to previous innovation and new business leaders. Purposefully demonstrate the impact the innovation initiative is having on the organization through regular communication and quantifiable results.

3. Ensure a deep and broad management commitment. An executive who spends 15 minutes in a staff meeting discussing innovation demonstrates very little commitment to new ideas. Nor does naming an executive, nearing retirement, as innovation champion. The drive for innovation should be integrated into the strategic goals in an organization. Management should then be evaluated in line with these innovation goals. In addition, managers should drive the innovation vision into their team goals and objectives. Are all managers committed? Are they evaluated against innovation goals? Underneath the management layers, is input sought regarding how innovation is truly perceived in the trenches?

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