All companies must innovate or risk getting “stuck in a zero-sum game, in which their gain can only be another’s loss,” says strategy and innovation consultant Ken Favaro in a new article for PwC’s strategy+business blog.
But many companies go about innovation the wrong way, he says, focusing on big mandates and putting the wrong people in charge of generating ideas. He offers three essential tips for innovation:
- Start with specific problems that demand novel solutions.
Rather than focusing on big mandates or stretch goals (such as “20 percent of our revenues in X years will come from new products”), Favaro advises companies to begin by determining which problems they need to solve. He cites the example of Ford’s moving assembly line, which solved the problem of how to democratize the automobile.
- Every problem should have an accountable leader.
Anyone in a leadership position should be responsible for finding innovative solutions to problems that fit his or her pay grade. The CEO needs to be front and center in driving enterprise-level innovation, not just the chief strategy or innovation officer, and product heads should be responsible for finding innovative solutions to specific product challenges.
- Hunt for precedents.
Ideas are inspired by precedents connected to the problems you are trying to solve. For example, by offering monthly subscriptions for movie rentals by mail, Netflix solved the problem of customers having to run to a store or else pay a penalty for late returns. Favaro says the idea was sparked by the model of monthly gym membership fees.
See the full article: “Strategy Talk: How Can I Make My Company More Innovative?“