Four Innovation Perspectives you need to understand
I'm writing today about how innovation consultants and service providers think about the innovation space - how they divide up the innovation decision makers and how they attempt to influence the decision makers and their thinking. I've divided these up as: strategy, design, marketing and PR, and process.
The big strategic firms - McKinsey, BCG - and the smaller niche innovation strategy firms like Innosight approach innovation as if it were a strategic problem. And it is. Innovation should always support a business strategy, strategic goals and strategic intent. However, innovation isn't just a strategic problem. Innovation is also an operational problem, a tactical problem and a cultural problem. Addressing the strategic aspects of innovation is OK, but as we all know grand strategies aren't enough. Real difference comes from the implementation of the strategy as new products and services that deliver value. Remember also that innovation isn't a strategy - it can be an enabler to existing strategies but by itself it isn't a strategy. So if your firm doesn't have a clear strategy or clear goals, innovation probably won't be much of a help.
The design firms - IDEO and Doblin as examples - want to position innovation as a design problem. And to some extent they are correct. Many problems can be solved through the use of integrated design. Imagine if we intentionally designed our products or our client interactions rather than simply allowed them to evolve. Innovation means incorporating different approaches and perspectives, and that's where the design concepts are helpful. But, much like the focus on strategy, design thinking isn't enough without implementation, and isn't sustainable without defined processes, skill transfer and cultural change.
The marketing, PR and advertising firms that are involved in innovation want to position innovation as a marketing and launch problem. They can be a marketing hammer looking for nails. Marketing, PR and advertising skills are important if applied correctly in the understanding of customer needs and in the launch of the product, but that doesn't mean that these firms offer all the skills and capabilities necessary throughout the innovation process. Additionally, like the design and strategy firms, they have arcane methods that don't provide for knowledge transfer.
Finally, there are firms (we at OVO are one) that think of innovation as a consistent business process. In other words, we believe innovation can be a process that anyone can follow within your business, much like a purchasing process or other established process. This doesn't separate innovation from strategy, since we've already agreed that innovation should be tightly linked to strategy, but creates a more consistent, sustainable way to undertake innovation over time. If innovation can become an internal business process, then it is far easier for anyone to innovate within your firm over time, and for innovation to become something that your firm does on a regular basis.
Note as well that all four of these perspectives are valuable and all four rely to some extent on the insights and capabilities of the others. A process oriented approach with no linkage to strategy can create a powerful but incremental innovation program, for example.
Another perspective when thinking about innovation and service providers is the concept of insourcing or outsourcing innovation. Many service providers offer to "outsource" innovation for your firm - understanding your issues or needs and returning several months later with a handful of ideas. While these ideas may be valuable, they don't convey any real insight or knowledge to your team or staff. If your firm isn't careful, you'll outsource all the strategic and critical thinking to a third party, emphasizing implementation over insight. We at OVO advocate insourcing innovation, using many of the same tools and techniques but working hand in glove with our clients to transfer knowledge and build skills. Many firms talk about becoming more innovative yet rely almost exclusively on outsourced innovation models. Without an established team and proven innovation process, most firms won't innovate successfully without outside help.
When you think about acquiring innovation help, make sure you understand the perspective your prospective partner takes on innovation - do they start from a strategic viewpoint, a design viewpoint, a marketing viewpoint or a process viewpoint? What are your goals? Do you want to acquire the skills to innovate internally, or are you, in the words of one of my clients, willing to "buy ideas from consultants"? There's not a wrong answer, but there are implications to your selections.