Friday, March 7, 2014

Delivering Breakthrough Innovation: The Execution Challenge

My earlier two posts dealt with zeroing on a potential break-through idea with the feedback from customers and experts. And believe me when I say that you have come just a quarter of the way. Still there is a long road ahead of execution and implementation. More disruptive the idea, more challenging is its execution.

But why is execution of a disruptive innovation so difficult, especially in established companies? The answer lies in organisation and processes of the company which is performance driven and focused on incremental growth in the boundaries set by the market conditions.

In other words, participating in execution of disruptive innovation is not part of any KPI of a manager and in many cases works against the existing KPIs. Consider following execution elements and the challenges: 
  • Detail solution design and development: Any disruptive idea typically requires a cross-functional team and external expertise. However, R&D and Engineering team are busy with projects for improving existing product. They cannot spare the manpower. And working with external experts raises IP & confidentiality issues.
  • Procurement of hardware/services for development: The procurement team is focused on cost reduction and applies the same process. The suppliers need to be registered and meet the criteria. They want competing quotes and negotiation for any procurement. Whereas you want to work with a designated supplier who is agile and understands your requirements without asking for a 50 page specification document. 
  • Production: The production plan is frozen for the year. There is no availability of machines and skilled manpower to work on your product. 
  • Customer discussion and feedback: Marketing team is busy with promoting existing products. Salesmen are busy with hitting their targets and have no time to discuss ideas with customers.

In nutshell, the organisational processes are designed for what they do best, to build on the past performance and efficiently earn the daily bread and butter for the company. Disruptive innovation is antithesis to what they are designed to do.

A certain organisational support is required to handle disruptive innovation. It would be wrong to rely just on an individual leadership and charisma.

The organisational support can come in following ways:
  •        Empowered team for Innovation with access to top management.
  •        Designated coordinators from each functional dept.
  •        Faster procurement channels
  •        Flexibility in pursuing external partnerships with start-ups, academics and other companies.
  •        A dedicated budget and regular review via say roadshows.

With the organisational support in place, next comes the team. The team may constitute of persons from diverse industry backgrounds and in-house experts. The common behavioural aspects are self-driven, open to new ideas and ability to perform in uncertain environment.

The organisational support and a good team are the foundation to manage and execute disruptive innovation. However, there is no formula for the execution itself. It can be chaotic, iterative, going back and forth, working-around, re-work etc. At the same time it would require painstaking attention to detail, documenting experiment results and mundane project planning & management.

So do you still think Innovation is glamorous and exciting?? J

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