Innovation moves at the speed of strategic clarity. While strategy defines how you will create value, innovation defines what value needs to be created.
The clearer your strategy, the easier it is to focus on the problems to be solved, the opportunities to pursue, the customers to serve, and the results that are required. Strategy cannot be successful without innovation, and innovation cannot be successful without strategy—and a well-developed strategy is crucial for meeting your innovation goals.
Too often when creating a business strategy, executives are successful in creating a vision but fail to define the different mechanisms that will help deliver that mission—the what. The organization then becomes confused about what the key priorities are, what resources to mobilize, what to measure, and what end results are desired.
Simple questions such as, “What products are you developing?” “What services are you delivering?” “What value are you creating for your customers?” “Where is the future of the company?” become difficult to answer explicitly when strategy and innovation aren’t aligned.
There are five common strategy mistakes that affect innovation. Take steps to remedy these, and you’ll find more success in both your innovation initiatives and your strategic efforts.
A Vague or Undefined Vision
Your vision defines the endpoint—the goal you are working toward, the journey you have to make. If you don’t have a clear and specific vision, it is hard for your people to imagine how far they need to go or what they need to do to reach the finish line. A five-mile journey, for example, requires an entirely different context, preparation, and mindset than a 500-mile journey. Your team won’t know what resources to gather or which innovation initiatives to pursue and won’t be able to set the right expectations to meet the strategic vision. As a leader, you won’t be able to answer the questions, “Where are we going?” or “Why are we doing this?” Defining a clear and specific vision is crucial, not only for the foundation of your organization’s strategy, but also to guide what resources, activities, and mindsets are needed to meet your goals.
A Lack of Creative Options
Companies often don’t spend enough time brainstorming and gathering creative options for the future, which leads to predictable, dead-end strategies. This is why you can often find the same strategies and options at different companies. Leaders at those companies just don’t put enough importance on building up their creative options. Doing this limits the possibilities for your future and, when it comes time for innovation, there’s almost nothing to innovate.
Great strategies and an abundance of creative strategic options, however, challenge the status quo. They dare the organization to look deep internally and wide externally—forcing the company to come up with the best option for growth. This type of work requires meaningful interactions with stakeholders and brainstorming hundreds of options. Without taking some risks and dreaming up options to address those risks, the organization won’t grow or meet its goals in the long run.
Inadequate Decision-Making Capabilities
Too often, strategy may be based on the right vision, and may even have the right options, but execution decisions are left to the wrong people. How you prioritize initiatives, operations, and resources can become a barrier to innovation and execution. In many cases, this is a fault of the organizational culture—perhaps innovation is even discouraged. Particularly when the focus is on the standardization of operations rather than challenging the status quo.
To avoid this strategic mistake, ensure your operational model makes room for an innovative environment. Innovation by its very nature challenges who makes what decisions, when, where, and how. It requires collaboration. You may have to create a new decision-making framework or reorganize teams to ensure an innovation culture. And while innovation does not guarantee success, it does guarantee learning, building, and experimenting, all of which will improve your organization’s decision-making abilities.
Unclear Measurements and Metrics
Both great innovation and great strategy are anchored in accountable measurements and metrics. For example, a company’s strategy may be to introduce a new product to the market. From an innovation standpoint, there must be leading and lagging indicators. What does the product do? Which customers does it serve? How will you know you’ve succeeded? Just by answering these three questions, your team will be focused on the customer, the problem to be solved, and the measurement of impact on the market as they develop the product. They can then design the right experiments and hire the right team as they innovate, and report and apply all of their measurements back into the strategy.
However, sometimes the strategy is left amorphous and measurements aren’t clear. If these are not first defined within the strategy, the innovation team is left to define the measurements and metrics however they want—whether or not they reflect the current business goals. The organization needs to create discipline by clearly defining these measurements and metrics at the start to avoid this strategic mishap.
Failing to Monitor and Learn
The greatest return on innovation is learning. The journey of strategy execution also often involves ups, downs, and windy roads—thus the need to learn quickly. The faster you can learn, the faster you can create value. It’s critical that monitoring and learning is deeply embedded in your organization’s strategy and day-to-day operations. When overlooked, innovation activities are never reviewed with the discipline and in-depth focus they deserve. Innovation becomes a playground rather than a true value creation exercise. Define monitoring and learning as a key element of your strategy and then infuse that into your innovation exercises. It will increase both the organization’s intellectual capacity and its capability to produce value.
If you’re struggling to find success with your innovation efforts, you might need to look closely at your strategy to find the problem. Ensure you aren’t making these five strategy mistakes that affect innovation.
Originally published in Leadership Excellence by HR.com. | Header Photo by Ylanite Koppens via Pexels.
