Build Your Enterprise Innovation Program

Transform your business by adopting the culture and practices that drive innovation.

Analyst Perspective

Innovation is not about ideas, it's about people.

Many organizations stumble when implementing innovation programs. Innovation is challenging to get right, and even more challenging to sustain over the long term.

One of the common stumbling blocks we see comes from organizations focusing more on the ideas and the process than on the culture and the people needed to make innovation a way of life. However, the most successful innovators are the ones which have adopted a culture of innovation and reinforce innovative behaviors across their organization. Organizational cultures which promote growth mindset, trust, collaboration, learning, and a willingness to fail are much more likely to produce successful innovators.

This research is not just about culture, but culture is the starting point for innovation. My hope is that organizations will go beyond the processes and methodologies laid out here and use this research to dramatically improve their organization's performance.

Kim Osborne Rodriguez
Research Director, CIO Advisory
Info-Tech Research Group

Executive Summary

Your Challenge

As a leader in your organization, you need to:

• Understand your organization's innovation goals.
• Create an innovation program or structure.
• Develop a culture of innovation across your team or organization.
• Demonstrate an ability to innovate and grow the business.

Common Obstacles

In the past, you might have experienced one or more of the following:

• Innovation initiatives lose momentum.
• Cynicism and distrust hamper innovation.
• Innovation efforts are unfocused or don't provide the anticipated value.
• Bureaucracy has created a bottleneck that stifles innovation.

Info-Tech's Approach

This blueprint will help you:

• Understand the different types of innovation.
• Develop a clear vision, scope, and focus.
• Create organizational culture and behaviors aligned with your innovation ambitions.
• Adopt an operational model and methodologies best suited for your culture, goals, and budget.
• Successfully run a pilot program.

Info-Tech Insight

There is no single right way to approach innovation. Begin with an understanding of your innovation ambitions, your existing culture, and the resources available to you, then adopt the innovation operating model that is best suited to your situation.

Note: This research is written for the individual who is leading the development of the innovation. This role is referred to as the Chief Innovation Officer (CINO) throughout this research but could be the CIO, CTO, IT director, or another business leader.

Why is innovation so challenging?

Most organizations want to be innovative, but very few succeed.

• Bureaucracy slows innovation: Innovation requires speed – it is important to fail fast and early so you can iterate to improve the final solution. Small, agile organizations like startups tend to be more risk tolerant and can move more quickly to iterate on new ideas compared to larger organizations.
• Change is uncomfortable: Most people are profoundly uncomfortable with failure, risk, and unknowns – three critical components of innovation. Humans are wired to think efficiently rather than innovatively, which leads to confirmation bias and lack of ingenuity.
• You will likely fail: Innovation initiatives rarely succeed on the first try – Harvard Business Review estimates between 70% and 90% of innovation efforts fail. Organizations which are more tolerant of failure tend to be significantly more innovative than those which are not (Review of Financial Studies, 2014).

Based on a survey of global innovation trends and practices:

The biggest obstacles to innovation are cultural

The biggest obstacles to innovation in large companies

Based on a survey of 270 business leaders.
Source: Harvard Business Review, 2018

The most common challenges business leaders experience relate to people and culture. Success is based on people, not ideas.

Politics, turf wars, and a lack of alignment: territorial departments, competition for resources, and unclear roles are holding back the innovation efforts of 55% of respondents.

FIX IT
Senior leadership needs to be clear on the innovation goals and how business units are expected to contribute to them.

Cultural issues: many large companies have a culture that rewards operational excellence and disincentivizes risk. A history of failed innovation attempts may result in significant resistance to new change efforts.

FIX IT
Cultural change takes time. Ensure you are rewarding collaboration and risk-taking, and hire people with fresh new perspectives.

Inability to act on signals crucial to the future of the business: only 18% of respondents indicated their organization was unaware of disruptions, but 42% said they struggled with acting on leading indicators of change.

FIX IT
Build the ability to quickly run pilots or partner with startups and incubators to test out new ideas without lengthy review and approval processes.
Source: Harvard Business Review, 2018

Build Your Enterprise Innovation Program

Define your purpose, assess your culture, and build a practice that delivers true innovation.

1 Source: Boston Consulting Group, 2021
2 Source: Boston Consulting Group, 2019
3 Source: Harvard Business Review, 2018

Use this research to outperform your peers

A seven-year review showed that the most innovative companies outperformed the market by upwards of 30%.

Innovators are defined as companies that were listed on Fast Company World's 50 Most Innovative Companies for 2+ years.

Innovation is critical to business success.

A 25-year study by Business Development Canada and Statistics Canada showed that innovation was more important to business success than management, human resources, marketing, or finance.

Executive brief case study

INDUSTRY: Healthcare
SOURCE: Interview

Culture is critical

This Info-Tech member is a nonprofit, community-based mental health organization located in the US. It serves about 25,000 patients per year in community, school, and clinic settings.

This organization takes its innovation culture very seriously and has developed methodologies to assess individual and team innovation readiness as well as innovation types, which it uses to determine everyone's role in the innovation process. These assessments look at knowledge of and trust in the organization, its innovation profile, and its openness to change. Innovation enthusiasts are involved early in the process when it's important to dream big, while more pragmatic perspectives are incorporated later to improve the final solution.

Results

The organization has developed many innovative approaches to delivering healthcare. Notably, they have reimagined patient scheduling and reduced wait times to the extent that some patients can be seen the same day. They are also working to improve access to mental health care despite a shortage of professionals.

Developing an Innovative Culture

• Innovation Readiness Assessment
• Coaching Specific to Innovation Profile
• Innovation Enthusiasts Involved Early
• Innovation Pragmatists Involved Later
• High Success Rate of Innovation

Define innovation roles and responsibilities

Info-Tech's methodology for building your enterprise innovation program

Innovation program taxonomy

This research uses the following common terms:

Innovation Operating Model
The operating model describes how the innovation program delivers value to the organization, including how the program is structured, the steps from idea generation to enterprise launch, and the methodologies used.
Examples: Innovation Hub, Grassroots Innovation.

Innovation Methodology
Methodologies describe the ways the operating model is carried out, and the approaches used in the innovation practice.
Examples: Design Thinking, Weighted Criteria Scoring

Chief Innovation Officer
This research is written for the person or team leading the innovation program – this might be a CINO, CIO, or other leader in the organization.

Innovation Team
The innovation team may vary depending on the operating model, but generally consists of the individuals involved in facilitating innovation across the organization. This may be, but does not have to be, a dedicated innovation department.

Innovation Program
The program for generating ideas, running pilot projects, and building a business case to implement across the enterprise.

Pilot Project
A way of testing and validating a specific concept in the real world through a minimum viable product or small-scale implementation. The pilot projects are part of the overall pilot program.

Insight summary

Innovation is about people, not ideas or processes
Innovation does not require a formal process, a dedicated innovation team, or a large budget; the most important success factor for innovation is culture. Companies that facilitate innovative behaviors like growth mindset, collaboration, and the ability to take smart risk are most likely to see the benefits of innovation.

Very few are doing innovation well
Only 30% of companies consider themselves innovative, and there's a good reason: innovation involves unknowns, risk, and failure – three situations that people and organizations typically do their best to avoid. Counter this by removing the barriers to innovation.

Culture is the greatest barrier to innovation
In a survey of 270 business leaders, the top three most common obstacles were politics, turf wars, and alignment; culture issues; and inability to act on signals crucial to the business (Harvard Business Review, 2018). If you don't have a supportive culture, your ability to innovate will be significantly reduced.

Innovation is a means to an end
It is not the end itself. Don't get caught up in innovation for the sake of innovation – make sure you are getting the benefits from your investments. Measurable success factors are critical for maintaining the long-term success of your innovation engine.

Tackle wicked problems
Innovative approaches are better at solving complex problems than traditional practices. Organizations that prioritize innovation during a crisis tend to outperform their peers by over 30% and improve their market position (McKinsey, 2020).

Innovate or die
Innovation is critical to business growth. A 25-year study showed that innovation was more important to business success than management, human resources, marketing, or finance (Statistics Canada, 2006).

Blueprint deliverables

Each step of this blueprint is accompanied by supporting deliverables to help you accomplish your goals:

Sample Job Descriptions and Organization Charts

Determine the skills, knowledge, and structure you need to make innovation happen.

Ideation Session Template

Facilitate an ideation session with your staff to identify areas for innovation.

Initiative Prioritization Workbook

Evaluate ideas to identify those which are most likely to provide value.

Key deliverable:

Enterprise Innovation Program Summary

Communicate how you plan to innovate with a report summarizing the outputs from this research.

Measure the value of this research

US businesses spend over half a trillion dollars on innovation annually. What are they getting for it?

• The top innovators(1) typically spend 5-15% of their budgets on innovation (including R&D).
• This research helps organizations develop a successful innovation program, which delivers value to the organization in the form of new products, services, and methods.
• Leverage this research to:
  • Get your innovation program off the ground quickly.
  • Increase internal knowledge and expertise.
  • Generate buy-in and excitement about innovation.
  • Develop the skills and capabilities you need to drive innovation over the long term.
  • Validate your innovation concept.
  • Streamline and integrate innovation across the organization.

(1) based on BCG's 50 Most Innovative Companies 2022

Info-Tech offers various levels of support to best suit your needs

DIY Toolkit

“Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.”

Guided Implementation

“Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.”

Workshop

“We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.”

Consulting

“Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.”

Diagnostics and consistent frameworks used throughout all four options

Guided implementation

What does a typical guided implementation (GI) on this topic look like?

A GI is a series of calls with an Info-Tech analyst to help implement our best practices in your organization.

A typical GI is 8 to 12 calls over the course of three to six months.

Workshop overview

Contact your account representative for more information.
workshops@infotech.com 1-888-670-8889

Phase 1: Define Your Purpose

Develop a better understanding of the drivers for innovation and what success looks like.

This phase will walk you through the following activities:

• Understand your innovation mandate, including its drivers, scope, and focus.
• Define what innovation means to your organization.
• Develop an innovation vision and guiding principles.
• Articulate the value proposition and proposed metrics for evaluating program success.

This phase involves the following participants:

• CINO
• Business executives