The amount of innovation within an organization defines a spectrum. Some companies like Apple and
Amazon are incredibly innovative; other companies like Blockbuster and Polaroid are not. Like
everything in business, once you instill the proper principles and routines innovation will improve.
No matter where your organization falls in this spectrum, it can always improve. Below are what
effective business executives do to spark innovation as well as eight methods any organization can
use to generate innovation.
Effective Business Executives Already Do The Following:
Ensure that their organizations understand their customers' needs
Establish collaborative relationships with their business partners
Allocate resources for training and development
Create a culture for change and continuous improvement
Model and reward the behavior they want from others
Incorporate external business practices that align with organizational goals
Eight Methods Companies Can Use To Generate High-Quality Ideas For Innovation:
Increase investment in idea generation
Develop customer understanding
Ensure executives are focused, on board, and sponsoring the initiative
Establish a favorable company culture
Use outside sources for ideas effectively
Partner with suppliers for new ideas
Dedicate additional resources towards innovation
Provide incentives and rewards towards innovation
To Run Successful Innovation Programs, The Focus Of Companies Should Be Four-Fold:
Leverage networks of internal and external partners to increase the volume of
ideas and solutions to business problems.
Ensure visibility across the entire organization and set up processes to
track the success of innovation initiatives.
Innovation project managers must anticipate downstream challenges
and make informed decisions on decisions.
Reward systems for teams working on disruptive ideas should be different from those that are
followed by the rest of the company. Organizations must work to create an environment that
mimics the collaborative start-up like environment. This allows innovation teams to collaborate
across functions to bring new ideas to life.
For Companies To Assess Their Innovation Initiatives And Benchmark Them Against
Those Of Competitors, They Use Ratios Associated With:
Percentage of sales generated through NPD
Percentage of net sales invested in R&D
Time spent by key stakeholders
Number of patents filed or granted over a specified timeframe
Examples of innovation tracking measures (identified through Evalueserve’s interactions
with organizations across industries)
R&D Innovation Efficiency – Ratio of sales from new product launches and total
expenditure on R&D
Return on Innovation Investment – Ratio of gross profit earned from innovation
and the cumulative investment period
Innovation Success Rate – Ratio of ideas commercialized to the total number of ideas
New Product Success Rate – Measured against a set of target parameters that include consumer
acceptance, technical acceptance, and gross margins
Consumer Satisfaction Index – Measured through consumer surveys to assess product performance,
the effectiveness of marketing activities, and response to FMOT/SMOT
Break-even Analysis – Detailed P&L to estimate the expected time to recover investments
made in NPD through product sales
Sparking Innovation By Setting Up Dedicated and Cross-Functional Innovation Teams
A simple way to build a culture of innovation is to connect business leaders and project
teams to relevant external experts quickly and inexpensively, so they can experience open,
“boundary-less”, innovation first-hand.
The processes across the innovation value chain require significant cross-functional involvement.
Sales and marketing gather specifications and needs through numerous consumer interactions.
Research & Development identifies possible technology solutions to meet those specifications/needs.
Lastly, manufacturing, engineering, and packaging turn a concept into a scalable product.
It is essential to ensure collaboration to translate concepts into tangible products. For a successful
innovation program, companies must develop collaborative teams that exhibit an entrepreneurial spirit,
diversity, and are not prone to functional fixedness. An ideal structure for a cross-functional
innovation team is one that provides cross-functional skill sets to stakeholders across the product
development value chain. The program should aim to improve business know-how and entrepreneurial
skills while helping the management identify and implement real innovation.
By combining expertise in business strategy and technology, companies can identify ideas that
have a higher likelihood of success, and then direct resources to bring these ideas to fruition.
Riley Moore (https://www.linkedin.com/in/rileyrm4tech)
Riley Moore, the 25-year old CEO at RM4Tech, the one and only completely family-owned family-run
software company, has used his mix of technical and business influences to bring his creative vision
to life. With the development of RM4Tech’s first solution, DirectSuggest 'The Suggestion Box Reimagined'
, he has become a fresh face in the world of engagement and innovation. Their second solution
CrowdQuestion was released in early 2019. CrowdQuestion is focused on connecting crowds through
'Q&A The Right Way' to bring everyone closer to their community. His passion to empower individuals
to use their creativity and voice to make a difference in the world is what drives him.
Riley's love for podcasting, mixed with his unrelenting drive to inspire individuals to change
the world through passion and hard-work, encouraged the creation of The Moore You Know
Podcast. He hopes to impact the world through entrepreneurship and podcasting like those
who inspired him.
Copyright 2023 by RM4Tech LLC. All Rights Reserved.