Archive for July, 2009
Strategic Innovation
July 21st, 2009 | 
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Company- and product lifecycles today are shorter than any time before in modern history, and strategic innovation is the only solution to stay on top of the industry in the long-term perspective. A study performed by McKinsey’s researchers demonstrates how companies on the S&P 500 has had an average lifetime of only 15 years in 2000, compared to 50-60 years in the 1920s (Foster and Kaplan 2001). Furthermore, life expectancy in Japan and Europe is now only 12,5 years (Burns, 2001). It is clear that companies aiming for a long-term future needs to deal with change and constantly produce new product cycles (innovate) to stay on top of competitors and markets.
Innovation is often described as a “black box” where one cannot predict the outcome of the input. Because variables the processes of innovation differ, it is hard to create a recipe for innovation. However, by putting preconditions in place by having plan for strategic innovation, one opens for innovation to happen. By learning about the process of innovation, and how to utilize this in the individual company, one gains competitive advantages that will outperform emerging competition.
On the input side, it is clear that learning is a central topic in innovation, and process and knowledge are vital elements that go before innovation. This learning occurs in a range of situations and is result of human interaction. Networks and organizations are therefore vital instruments to create a platform for learning. However, learning also takes place in a context, and at a certain location. There are many more variables that impact the learning process, and a strategic innovation plan is therefore needed to guide these variables towards a favorable context.
On the output side of innovation, there are many obstacles that prevent learning to become innovation. One major obstacle throughout history is that innovation has been the duty of R&D departments, and that new fancy solutions have been lacking a sufficient market to sell the product. Furthermore can organizational culture stop good ideas to reach the market due to lack of experimentation or inadequate incentive systems. Therefore, the management must make sure the organizations are prepared for innovation.
This website will help you understand innovation, so that you can have a killer advantage to battle the market in a time where change is the only constant. By implementing strategic innovation in your organization, your company will be prepared for long-term profit maximization, as well as social and environmental challenges in years to come.
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