Innovation is when an idea meets the market needs and expectations, offering financial return to companies.
In this article I will share some insights about the future of corporate innovation, based on a presentation I recently gave at a Cinq’s innovation and trends guild meeting. I am a member of an organizational OKR whose goal is to transform our company into an innovation hub. In this sense, we have some strategic initiatives such as this one from the innovation guild, InnA (innovation program for generating new business ideas), presentations on innovation during new employees onboarding process, benchmarking with areas of innovation of corporates and startups, among other projects.
When we deal with innovation, creativity is a correlated subject and I generally recommend the Nobel Prize-winning book of economics: “Thinking Fast and Slow” written by Daniel Kahneman. This addresses two types of thinking – divergent (it is connected to the right side of the brain and drives originality. It is the type of creative/germinating thinking, which is linked to brainstorming and the search for new contexts and meanings) and – convergent (it is linked to the left side of the brain and drives relevance. It is the kind of analytical thinking, which seeks the most effective and appropriate solution).
But, Nôga, what is the concept of innovation you like the most? I pretty much believe in this concept: “Innovation is the transformation of knowledge into money”, by Geoff Nicholson. He is considered the “Father of Post-it” and was one of the leaders who most encouraged innovation at 3M. After nearly forty years of experience in the company, Geoff got to the international vice presidency, inspiring people and processes.
So, innovation is when an idea meets the market needs and expectations, is viable from an economic and sustainable point of view, and offers financial return to companies. That is, every innovation needs to generate results. Innovation is neither invention or discovery. It may require these concepts and it often happens. But its focus is not knowledge, but economic performance. The first application of an innovation should be the strategy, getting as close as possible to its ideal. However, in the process of being considered an innovation, your clients need to recognize the value of their entire investment.
Therefore, all innovation arises from a problem. For this reason, I brought some data from the report “IBM CEO Study 2010” regarding the three biggest corporate challenges for CEOs and at the time the following was presented:
- Hyper-competition: industries are in rapid and unpredictable movements; more and more unusual competitors emerge and competitive movements are increasingly intense and fast;
- Complexity: “Events, threats and opportunities are not just coming to us faster or with less predictability; they are converging and influencing each other to create entirely unique situations.” – Samuel Palmisano, IBM CEO Study, 2010;
- Innovation: Creating products, processes and services that transform the industry, that are new to customers and that present superior attributes and experiences.
Making a ten-year comparison in 2020 – across this pandemic context and new normal, PwC did a survey with CEOs called “How business can emerge stronger” and these brought the new plans for this year, as follows:
- CEOs plan to make their businesses more digital and virtual. They will digitize core business operations, processes, and add digital products and services.
- CEOs also plan to develop a more flexible and employee-oriented workforce. They will increase the participation of remote employees and expand health, safety and wellness programs.
Another point we also discussed in the guild is the fact that customer loyalty is overrated and in this sense we need to develop a cumulative competitive advantage based on: 1) Habit designing; 2) Innovate within the brand; 3) Keep the brand message simple and the buying decision easy. 3) Humans make about 35,000 decisions a day, which makes the competitive advantage truly sustainable is to help consumers avoid having to make a choice. 4) Habits are so powerful that all culture, country and religion are defined by them.
In the meantime, constantly innovating can be a way to increase customer loyalty, and when dealing with types of innovation, we have the three horizons theory presented by Mckinsey, according to the axes of value for the client, and present and future relationship. Thus, there are core business innovations (horizon 1 – maintenance of the main business – low value for the client and closer to the present), adjacent innovations (horizon 2 – cultivating emerging businesses – average value for the client and intermediate present-future relationship) and transformational innovations (horizon 3 – creating genuinely new businesses – high value for the client and relationship closer to the vision of the future).
As we comment that problems are the key to innovation, we see that 2020 is the year of corporate reinvention. In many companies, this reinvention is happening in the midst of new restrictions such as: hiring freezes and tighter budgets. In others, budgets may be stable, but there are new expectations around timelines and priorities. Thus, some reflections arise: Can innovation help employees stay safe? Can it help to rethink what used to be a face-to-face sales process? Can innovation help identify high-value opportunities that were not feasible to pursue just a few months ago or introduce tools that can help the organization be more agile and collaborative?
According to Steve Blank (2020), corporations equipped for the challenges of the 21st century think of innovation as a sliding scale between execution and search. For companies to survive in the 21st century, they need to continually create a new set of businesses, inventing new business models. The crisis and recovery of COVID-19 creates fundamental changes in our economies and societies and a “new normal” is emerging. The winners in this new normal will be able to understand quickly: what the main skills/capabilities of your company are and which are the new needs of the market where your skills/capabilities could be used.
Finally, I bring some testimonials regarding how some innovation professionals have seen the future of corporate innovation.
“I believe the future of corporate innovation is open 🙂 Working in Red Hat I came to understand the power of open culture, to avoid lock in (to make it very difficult for customers to opt for another solution). Being able to leverage the power of communities for innovation makes a big difference.” – Mary Provinciatto – Engagement Lead – Open Innovation Labs (EMEA) – Europe and Africa.
“I see innovation in companies dependent on an environment and culture that are extremely favorable to design, cooperation, experimentation, learning, risks and where error is considered naturally as part of the challenge. There are interesting mistakes that culminate in inspiring hits, and need to be recognized to stimulate courage to innovate. The result achieved by innovation, even in small victories, must be very celebrated and disseminated to refuel the cultural cycle.” – Carlos Alberto Jayme – Chief Growth Officer – Cinq
“New natural forms of programming will undoubtedly accelerate the process of digital innovation. But a major impact will happen on business management as these new natural language technologies will establish a collaborative relationship between people & machines, no longer a tool relationship only. This will require innovation in processes and especially in people’s mindset.” – Renata Zilse Borges – Head of Design – Cinq
“Innovation became a fundamental part of the business process. With the current ease of creating new solutions that more efficiently solve people’s problems, companies that do not innovate will have their business taken over by new offerings. In this context, the process of continuous innovation, with rapid survey and validation of hypotheses and that does not compete with the day-to-day of the company is fundamental. This mindset must also be incorporated throughout the company, so that each person is attentive and can assist in the process.” – Luis Lima – Head of Solutions and Pre-Sales – Cinq
“I believe that the future of innovation is adaptability. Possibly innovation will no longer be the responsibility of a single area but the whole company’s, after all innovation is linked to culture and people. In this sense, the humility of (re)learning and continuously sharing will be increasingly necessary to generate prosperity for all.” – Nôga Simões – Innovation and International Marketing Manager – Cinq
If you would like more information about innovation at Cinq, please contact firstname.lastname@example.org
Author: Nôga Simões