How to mess up innovation. And how to do it right.
How not to innovate
Most entrepreneurs and managers innovate incorrectly. Sometimes they do it just wrong and sometimes they do it very wrong.
The wrong way of innovating happens when a leader looks at a problem in their organization too simplistically and ad hoc, instead of thinking about the broader implications or the real causes of the problems. The very wrong way is the result of FOMO or (intellectual) laziness, without a real needs analysis or consideration of the fit with the organization.
Wrong innovation and very wrong innovation
Wrong innovation starts with a problem. There is not enough grip on sales leads, employees seem dissatisfied, or the PMs are too inefficient. The leader thinks deeply and sees that new sales software must come directly, holacracy must be introduced tomorrow, or a quick choice must be made between Asana and Microsoft Dynamics. Success is just a matter of picking the right software tool, course or book and you're done! Admit it. You’ve been here.
Very wrong innovation does not start with a problem, but with a solution. Sometimes the entrepreneur has read a book on his vacation that he wants to try out, he has hired a new marketing manager who swears by Hubspot because it worked so well at his previous employer, or a flashy competitor is applying a new method. Just copy that method or roll out that software tool and we are winners! More recognizable than you would like to admit?
What will go wrong
Both wrong and very wrong innovation lead to the same frustrating outcomes:
While one problem is solved, other problems arise elsewhere;
Pilot projects are never completed;
Frustrations arise over “yet another software tool to learn” or “the boss is making us try something new again”;
Only about 10% of the features of very expensive software is used (looking at you, Hubspot!);
Innovations stand alone, instead of having any coherence or reinforcing each other;
A house of cards of “quick fixes” is built; and
Employees develop resistance to change because they feel overwhelmed by constant changes that do not contribute to their work or well-being.
Why this is even more important in the AI era
Currently, we see entrepreneurs hastily purchasing AI tools everywhere. Sometimes out of fear of missing out or the desire to be innovative. Often also the dream of halving their workforce.
Unfortunately, this is usually not even wrong innovation, where they at least start with a problem, but very wrong innovation, where they simply join in the hype.
Even if tools really work, you cannot help but consider the wishes and needs of your team and customers. Innovation must be human-driven. Throwing tool after tool into your organization will fail if you do not know how it contributes to your strategy, aligns with your values, and improves the well-being of your employees.
In this acceleration of innovation, more mistakes and false paths loom. And the consequences of missteps are even greater due to the pace of innovation. Therefore: do innovation in the right order. Take the time to think.
How to innovate correctly
First strategy
Wise innovation begins with the question "what is strategically important for my organization?" Higher sales or lower costs can be strategically relevant priorities, but so can customer satisfaction, employee happiness, future innovation power, operational resilience, or one of the 9 other categories that Too Much Tech uses.
To innovate effectively, you must periodically determine with your leadership team what is strategically important. This is not always about change; sometimes it is strategically valuable to change nothing at all. This is absolutely not advice to update your company's strategy every 3 months! The goal is simply a periodic analysis of: what should we be concerned with right now? What is must-have, what is nice-to-have, and what is pure distraction? If you do this well, you will have a list of 2 to 4 strategic priorities per period.
Then tactics
Once you have the 2 or 3 most important strategic priorities of your organization clear, you can start thinking about all the methods and tactics you can use to pursue that goal. This might be flashy new AI tool, but more often than not what you need is not tech at all. Maybe for employee satisfaction, you don't need another app, but a better Christmas package than a €20 Amazon gift voucher? (Yes, this is a true story.)
The whole trick in this phase of devising tactics is also to think about innovations that pursue more than one of your strategic goals at the same time. Also, this is the moment where you consider whether a tactic that helps lower your costs is not so frustrating for your staff that your staff turnover goes through the roof. In other words: are you breaking things elsewhere in pursuing this goal.
Then you choose one or two innovations to pursue. Focus is the whole idea here. That is of course difficult when you have just thought of dozens of great tactics, but it is absolutely essential.
Our advice is to choose an easy short-term project with limited implications in combination with a more difficult ambitious goal. In innovation management, they call this an ambidextrous strategy, where you combine incremental innovations with radical or disruptive innovations.
ChatGPT says about this: “Organizations that adopt an ambidextrous strategy aim to simultaneously be efficient in their current market while also engaging in explorative activities to create new opportunities. This often requires careful balance and managing potentially competing priorities within the organization.”
Then the solution
Now that you know what your tactic will be, you can attach hard success criteria to that tactic. When is it successful? What is must-have? What is nice-to-have?
Here discipline is required, because almost everyone tends to take the beautiful promises of suppliers and applications into their wishes. And before you know it, you're innovating very wrongly again, where the solution becomes the goal itself. Everything that is not must-have or nice-to-have is irrelevant for your selection of the solution!
The success criteria you use for a tactic must therefore take into account your strategic priorities and your values. Not least how the solution can contribute to innovation capacity in the future.
And now we are (finally) where the bad innovators started: we know the solution we want to roll out. With the big difference that we are not just doing something randomly this time. This time, the solution is part of a strategy and there has been careful thought in advance about what is needed to make it succeed. That does not mean that the innovation will necessarily go smoothly, that it is with 100% certainty a good decision, or that we have solved world hunger. But the chances are significantly higher that you have chosen an innovation this time that is realistic, has support, and contributes to what is most important for your organization.
Let go of your problems for a while
As you can see above, we are not talking about problems, but about strategic priorities and tactics. That does not mean that as an entrepreneur you should never be concerned with your problems. If your kitchen is on fire, we would advise grabbing a fire extinguisher. But if there is no fire, then it seems unwise to discharge the fire extinguishers in your kitchen because you heard such an interesting podcast.
Even if you have an acute problem that needs a solution now, it is useful to test the solutions you are considering against the previously set strategic priorities and the values of your company. Mapping out those priorities and values can only happen at a moment when the kitchen is not on fire. You will have to create a calm moment for this.
So, take the time for this. Let go of your problems for a while. And if you can't do it alone, then ask for help. What you are looking for is people-driven strategic innovation management. Coincidentally, we have been doing this for years and are good at it. We would be happy to help.
Who has time for this?!
If you and your management team concentrate, the first time will take only a few afternoons. And maintenance costs you an afternoon per quarter. If that is not achievable, then you are far too busy with everything except leading your business. If you, as the captain, have no time to plot the course, you might as well be floating on a raft.
Together we turn ambitions into outcomes
If you do not have all the knowledge yourself, Too Much Tech can help you with that. Together with our clients, we develop human-driven AI innovation strategies. The role distribution is clear:
You know your company, industry and customers like no other
We know strategy, execution, communication and team dynamics
Together, we turn ambitions into achievements.
Check out toomuchtech.nl to read more about effective people-driven strategy development.