How will your company create new sources of long-term profitability and growth? What are the opportunities and where will you find them? Will your company be able to cultivate a culture of innovation to ensure its future success?
Innovation must be a core competency for every organization. This is the new mission for business leaders throughout the world. In the future, success will come to those who can leverage their knowledge and capabilities in order to create better solutions to old problems and new solutions to problems that have not yet been identified.
Companies must focus on innovation because competitive innovation is a contest between management's thinking processes – what we call cognitive competency. Organizations must become more innovative by identifying and using their intellectual capital in ways that more effectively enhance their value creation processes.
Ask any CEO in the world to write a top-five wish list and you can bet that more ideas and better ideas is bound to show up in some form. Why? Because ideas and innovation are the most precious currency available to organizations in the new economy.
According to a recent study, the main challenges to making a company more innovative are:
1. Committed, inspiring leadership. Leaders need to be more deeply involved in the innovation process by inspiring, encouraging and reinforcing innovative behavior.
2. An enabling climate. The organization must develop new processes and systems for enabling people to be more innovative. This includes competitive strategies that promote innovation; quality strategies that promote and reward innovative behavior; and compensation systems that reward innovative behavior.
3. Creative people. Everyone is creative at something. The key here is to create an environment and provide the tools to help people be more creative. There are many extremely fine resources, training programs and books on enhancing human creativity.
4. Greater comfort around risk taking. If organizations spend nearly as much time in helping people understand the nature of human risk taking as they do in trying to understand the nature of financial or technological risk taking, people would develop a higher comfort level with taking moderate risks and innovation would increase.
5. Time to work on innovation. One-shot, organizationally isolated innovation projects do not work very well. Anybody who has worked in organizations and promoted innovation knows this.
People need to have the time to work on innovative projects and receive the rewards that go along with that. Think of the highly innovative companies like 3M or Google, both of whom permit their employees to select and work 15% and 20%, respectively, of their time on innovative projects of their choosing.
So, what's the main ingredient here? Of course, the source of all ideas: people! People are the main challenge. But how will you select the right people to help solve the problems? It's a fact that all people solve problems and are creative !! But … they differ in how they approach problem-solving.
Ask yourself these questions: how can you help your teams be more creative at problem-solving? How can you get more out-of-the-box thinkers on your problem-solving teams? Organizations must develop new approaches to selecting people to work on problem solving teams by assessing their talent, their experience, their perceived creativity, and their expertise.
For today's leader the management of innovation ranks at the top of the most challenging list. The scope of problems and the need for innovative problem-solving skills are as broad as the number of people on the globe.