Unlocking enterprise-wide innovation is critical to the process of digital transformation, according to Aaron McEwan, who explains that there are three steps to developing network innovation strategies
Digitalisation has become a top priority for 90 per cent of corporate leaders. In fact, it’s so important to the next phase of business growth that an estimated US$1.7 trillion will be spent on digital transformation in 2019, according to Gartner research into the digitalisation, business and innovation.
Today, digitalisation means much more for organisations than the adoption of digital technologies. It is a holistic change event that affects many fundamental pillars of how businesses operate, including people processes.
HR’s role in digital transformation has typically been to attract, develop and retain digital talent and to help the workforce adapt to digital changes. While the call for digital talent support was clear, it’s no longer the end goal for leaders.
Gartner research shows that what our CEOs are really focused on – and what they really want more of – is to unlock innovation across the entire enterprise.
Innovation in the digital age essentially comes down to two things; the first is innovating to improve existing products or services and secondly, to create new products and services.
Leaders know that to be competitive, their business need to innovate faster, develop bigger ideas that reach a broader audience and ensure their speed to market is significantly quicker. So why isn’t it working?
“A network innovation approach builds on draws on a network of expertise, including both employees and leaders to innovate at scale”
Innovation has to move out of pockets and silos and move across the enterprise. This will require a fundamental shift in the way organisations have typically approached innovation, which is to either take an individual or a team-based approach.
Individual innovator strategies: Where employees are given more time to work on their own innovation projects with autonomy. It equips and motivates individual employees to generate and share innovative ideas. Organisations that take this approach have just a one per cent impact on innovation effectiveness.
Innovation team strategies: This idea tries brings crowdsourcing to life in organisations and is where businesses focus on setting up dedicated teams, structures, hubs and centres to generate and drive innovation across the business. This approach has a six per cent impact on innovation strategies.
It’s clear that the traditional methods for innovation are not working fast enough or well enough for organisations to drive the growth and change businesses are seeking.
What organisations should be doing is shifting from lone innovator and team innovation strategies to a network innovation approach.
Instead, organisations should look to identify and engage:
- More employees who are actively engaged in generating idea – develop a pool of innovators and diversity of expertise from across the organisation.
- The risk aversion that stifles innovation – secure more buy-in from leaders who are willing to take risks on their disruptive ideas.
- Momentum for innovative ideas – develop cross business support for the generation and creation of idea.
“In comparison to the other types of typical innovation practices, network innovation has a 23 per cent impact on innovative outcomes”
A network innovation approach builds on draws on a network of expertise, including both employees and leaders to innovate at scale. In comparison to the other types of typical innovation practices, network innovation has a 23 per cent impact on innovative outcomes.
3 steps to network innovation
To develop network innovation strategies, organisations should:
1. Involve employees in the filtering, not just generation, of innovative ideas
This will increase employee engagement in ideation. It also helps make employees part of the selection process by promoting ideas which they believe should be put forward for funding etc.
2. Equip leaders with shared, not individual, risk-taking
Help leaders to determine their risk profile individually and then as a collective group. Training can be undertaken that supports a mentality for collective decision-making and prepare leaders for shared risk-taking in order to reduce risk aversion.
3. Give employees more guidance, not more access, for using networks to innovate
This helps innovations gain momentum across the organisation and effectively stops a particular idea from ‘dying’. Gartner has found that organisations need to focus on helping employees understand the formal innovation structure and encourage them to build informal networks around it. Organisations need to give employees guidance on how to navigate innovation within the network because reliance on organisational structure alone won’t work.