The Complete Business Innovation

Are you looking for making your business powerful? If yes, you need to believe in innovation and new brilliant ideas.

Good ideas may surface from the farthest reaches of the organization. Thus the challenge for top executives is to stimulate experiments across the entire organization, select the most promising, and disseminate them quickly and widely throughout the business.

Now a day there is competition in consumer demand, information and new technology. Your idea from wherever they come from it must be nurtured and applied as efficiently and effectively as possible in order to reap economic rewards.

Overview

The early research on innovation tended to address the organization’s ability to respond and adapt to external and/or internal changes (Burns and Stalker) (Hull and Hage). Subsequent work on innovation stressed more pro-active innovation and distinguished between types of innovation. There are three types of innovation (process, product/service, and strategy) each of which can vary from incremental to radical and from sustaining to discontinuous.

Emphasis was on the organization’s ability to promote both process and product innovation, regardless of an immediate need for change (Kanter).

Innovation VS Invention
The Oxford English Dictionary defines innovation as "making changes to something established". Invention is the act of "coming upon or finding discovery". Innovation doesn’t mean changing everything. Ponder about changes; don’t struggle to discover which is not needed at all at the junction. We should not mix innovation with invention.

The Complete Business Innovation

Innovation is generated at Individual, Project, Organization and
Environment levels. However, if I say business Innovation comprises of innovation in every elements of business then it is not acceptable.

1. Innovate Market or Innovation from Market (Consumer)
2. Innovate Industry or Innovation from Industry (Competitor)
3. Innovate Product or Innovation from Product / Process (Operations)
4. Innovate Team / Organization or Innovation from Team / Organization (Management)

Innovate Market or Innovation from Market

"Business has only two basic functions marketing and innovation," says Peter Drucker. However Robert Tucker suggests five steps necessary to make a business innovative.

1. Innovation must be approached as a discipline, practiced and taught to employees.
2. It must be cross-functional, not just be the R&D department's job.
3. It must be proactive, not just responsive to what competitors are doing.
4. It must involve everyone in the organization and everyone's performance evaluation should include it.
5. It must be customer-centered.

First, second and forth steps belong to innovation from organization. Third and fifth belong to innovation from market. Surveys and research carried out at market enable organization to be innovative. We will see innovation from organization in details.

Innovation from Organization

Jim Biolos in Harvard Management Update offers the following six steps toward making a team innovate:

1. Make sure that the members of the group are communicating with one another in a free-flowing or maybe even freewheeling way.
2. They have enough responsibility, including some you might be tempted to keep for yourself.
3. Show confidence in the team.
4. Provide the appropriate resources to the team, and make sure its members know that those resources are available.
5. Make sure that each team member has challenging work.
6. Monitor the pressure.

Team’s Success

Employees of China's Haier, for example, discovered through visiting rural customers that they frequently used their washing machines not only to launder clothes but also to clean vegetables. By making a few minor modifications to the washers they manufactured, Haier was able to market the machines as versatile enough to wash both clothing and vegetables, and rapidly became the market leader in rural areas of its home country.

The teams consist of up to ten people who devote about one-quarter of their time to the project for three or four months. Participating on a team is considered a plum assignment because it provides exposure to top executives. Team members also recognize that they must develop an actionable plan for pursuing the opportunities because the innovation committee frequently taps team members to implement the idea.

Innovation from Management

Managers don't simply copy something they see elsewhere. They take pieces of practice or technology that they find and recombine them in novel ways to solve customer problems. Says Philippe Pommez, Natura's R&D director, "The hard part is not finding the new technology; it is knowing what you are looking for. This is where our conceptualization of new products and new lines that serve local needs becomes indispensable."

Managers in developing countries sometimes despair of closing the gap with larger and better-funded multinationals. Clearly, there is hope for companies anywhere in the world to win through innovation and creativity. Moreover, managers anywhere can use the practical innovation tools used by developing country champions to innovate on a shoestring.

Innovate Industry or Innovation from Industry

There are three important fundamentals of innovation and entrepreneurship.

First, Industrialist searches for innovative opportunities and develops an innovative idea into a practical business or service. Second is industrial strategy that brings innovation successfully to market. Third is free enterprise itself and focuses on the organization that is the carrier of innovation.

When most people think of innovation, they envision developed-world companies such as the U.S.A.'s IBM, Japan's Sony, South Korea's Samsung, Finland's Nokia, or Switzerland's Novartis, technology leaders that have stayed at the cutting edge of dynamic industries such as computer hardware and software, consumer electronics, and pharmaceuticals.

Joseph Schumpeter defines innovation as the combination and creative application of existing and new knowledge elements to improve existing or develop new products and services, production process, organization-methods and commercialization in order to create or keep added value.

Innovation in Product

Switching to new market with same product can be innovative to some extend.

However, Innovation in products is an ultimate goal of team most of the times. Views from customers through research carry forwarded to R&D team for further product innovation. Product innovation depends on how good you are at learning from market, industry and team. Probably "Johnson & Johnson" is great example of successful innovations in products.

Further Readings

What Developing-World Companies Teach Us about Innovation
By Donald N. Sull, Alejandro Ruelas-Gossi, and Martin Escobari