In today’s business environment, the ability to innovate successfully and cost-effectively has become even more crucial than ever before. As global competition intensifies and commoditization increases, companies in every industry conclude that innovation in products, services and business models is needed to attain and sustain results. Companies often need to cut costs while improving the speed at which they move from idea to market launch. To generate a positive return on innovation investments, companies need to address a number of challenges.
Turning innovation into a business discipline
Research and development is still seen as a black box in many organizations. While manufacturing, logistics and other functions have been trimmed for efficiency over decades, processes and management of new knowledge is often not that developed. The way ideas and knowledge are generated, captured, enriched and developed is often lack supporting processes and routines. At the same time companies increasingly realize they need to manage and execute innovation as an end-to-end process, instead of hoping for an occasional lucky shot in the R&D department. Turning innovation into a business discipline without killing creativity and imposing heavy administrative routines is one key challenge.
Breaking down internal silos
To constantly develop technologies, products, solutions, services, and business models companies must know what knowledge they have that is valuable within the organization and who possesses this knowledge. Poor interdepartmental cooperation is a great challenge for companies that sometimes find it easier to find knowledge outside the organization, than inside. Many companies suffer from an inability to communicate across departments in important innovation processes. The starting point for breaking down internal silos is to create a shared language of innovation and intellectual assets. Breaking down internal silos to enable interdepartmental cooperation is a necessary challenge, especially for larger companies, to tackle.
Collaborate to innovate
Companies are increasingly collaborating with third parties to develop new technologies, products and services. Collaborative innovation can be a cost-effective alternative to traditional development, and a source for new ideas and insights, but it is known that technology executives are more likely than their business peers to embrace principles openness. Collaborative innovation requires sophisticated management processes to reduce costs and risks, and to get the most from each initiative. Companies must know why they collaborate, what they bring to the table, what they expect to get out, how to measure the progress, and manage the results and contractual agreements.