Innovation must be a factor of daily success
Several studies in recent years have shown that the majority of business innovations do not meet their objectives, or even pass the launch phase. Andrew Lewis, Managing Director of TRA, explains why innovation should be part of everyday reality for optimal results.
I work with organizations to help them solve some thorny issues – whether it’s getting people to commit to Covid-19 vaccines or figuring out how desirable products can be made from freeze-dried cheese. . And through it all, one thing is consistent, the strange and almost mystical relationship that we, as a business community, have with innovation.
Of all the business functions, this is the one we tend to mythologize the most, treating it more as dark art than an everyday work practice. We see those who are largely successful, like Apple or Tesla, to be some sort of miracle; magicians or alchemists transforming ordinary perceptions of the markets into valuable game-changing ideas. We whisper in low voices those who fail spectacularly, lest the taint rub off on us.
This religious zeal is not without some merit. We all claim that innovation is critically important, but recognize its elusiveness.
Separate studies from McKinsey and Accenture show that more than 80% of executives say innovation is key to their future growth strategy and vital to their future success, but the same studies show that less than 10% of executives are satisfied. innovation performance. And the data tells us that 95% of all product innovations and 92% of new start-ups fail.
Which is fascinating, really. Imagine that it is the same for other functions, like marketing or human resources? What if 95 out of 100 employees are not performing well or if 95% of our ad spend misses the mark? If it’s so critical, how come we don’t get it more often? It’s not like we aren’t spending money on this business – in 2019/20 Australian companies alone spent $ 18.2 billion on R&D.
We are wired to innovate
From a human behavior perspective, one thing that has always interested me about these failure rates is how they go against what we know about how the brain works. As humans, we are basically hardwired to seek variety. When confronted with new situations or stimuli, our midbrain lights up with activity and floods us with dopamine, encouraging us to dig deeper into our research to find a reward. As long as we don’t perceive a threat, we naturally prefer novelty.
This implies that instead of innovation being one ‘in a million’ hit, created by rogue geniuses, it should be part of the daily ebb and flow of business.
So how is it that we are wrong? How is it that so many ideas fail? We always seem to approach the task of innovation in the wrong way – and fail to fill the variety-seeking nature of people.
Kaihan Krippendorff, innovation writer and founder of consulting firm Outthinker, has spent years studying this space and has determined that the success of innovation largely comes from individuals – employees or entrepreneurs – spotting an opportunity than others have not seen, and of course, having the passion to carry it out.
He argues that successful innovation, despite most internal setups, comes less from research and development or a company-sponsored team and more from an individual perspective and connection to markets.
This also rings true from a human behavior perspective. Typically, internal teams and labs are motivated more by loss aversion biases in their approach to innovation: playing it safe, leveraging existing beliefs of key stakeholders, and working within internal boundaries. . This same bias will also likely ensure that they don’t support generic ideas coming from individuals outside of their teams, who have their own ideas for personal breakthroughs. And this is where the lost opportunity lies.
A connected person, with a unique point of view
Our work as a human analysis agency can be seen as an attempt to replicate the entrepreneurial ideas that drive successful innovation. Through the use of cultural currents, data and ethnographic research, we seek to achieve this same breakthrough perspective – an angle on a problem that opens up new ways of thinking about solutions.
With this in mind, it makes perfect sense that successful innovation often begins with a connected person who sees a market differently. Unfortunately, it also makes sense that this is something that organizations struggle to accept and embrace.
Consider how innovation in science works. Science is exploratory in nature, actively testing hypotheses resulting from a systematic approach aimed at bringing out new ways of thinking. The scientific method is designed to minimize bias and prevent existing beliefs or assumptions from blurring the results.
And scientists don’t limit themselves to past work – the equivalent of organizational knowledge – they take a broader view, borrowing and stealing from other disciplines and life experiences. If Archimedes hadn’t made the leap by taking an overflowing bath, his principle of displacement might not have emerged for many years.
Likewise, only by creating a culture of innovation in your business, with generic ideas to explore and where people are given the green light to experiment and test, can we increase success rates. of innovation.
Until we can shatter our own limiting ideas about what creates success, innovation is destined to remain in the realm of mysticism rather than that of everyday reality.