Traditional approach to strategy management in business organizations refer strategy to mean corporate strategy (“What business should we be in”) and business strategy (“how shall we compete in this business”)
Other references are classified as functional strategies.
However, we are discovering that innovation and innovation strategy is now a very critical part of corporate and business strategy. The pace with which markets and businesses are getting disrupted, the lifecycle of business without innovation is getting shortened at an alarming speed.
This brings the question, can organizations develop strategy for growth without factoring innovation? A 2020 McKinsey reports that 84% of executives interviewed now consider innovation to be the key element of growth strategy. 80% of them further believe that their business model is at risk. Others have concluded similarly.
All this is would indicate a crying need for inclusion innovation as part of strategy exercise; without a strategy for innovation led growth, all business and corporate strategy exercise will be meaningless.
Unfortunately, innovation capability doesn’t rank very high in most organizations. Innovation 360 research show that only 10% of organizations that want to innovate have the capability or understanding of innovation, while a McKinsey study found only 6% of executives are happy with their innovation capabilities.
At Think Horizon Consulting we believe that organizations need to balance their strategic efforts by considering the present (today’s business), tomorrow’s growth needs and the future using a 3 horizon approach.
This doesn’t mean planning what needs to be done in the short term, medium term and long term. That is a faulty approach to strategy.
A balanced strategy defines What We Should Do Today to achieve our short, medium and long term goals.
This means defining the portfolio of activities that we should be engaged on in a dynamic roadmap
Which activities must we be engaged in today to meet the immediate needs of market momentum and organic growth?
What projects, pilots and prototyping should we be doing to identify growth opportunities that can drive growth in the short term?
What experiments, investments and explorations should we be doing that will provide us the disruptive concepts to drive future growth.
An innovation led growth strategy should achieve the following
Growth targets over defined time periods for the current portfolio (known to a large degree) and an innovation led portfolio (higher level of uncertainty)
A 3 horizon strategy roadmap consisting of
Project plan for strategic initiatives with goals and timelines
Plan for building competency
Innovation KPI's (Strategic, operational and tactical)
Governance structure to drive and manage innovation
Blockers that need to be eliminated and strengths that need to be amplified to achieve goals
We help both large organizations as well as SME’s to develop their innovation strategy. Here is what one of our client had to say about this exercise
A lot of SME's feel intimidated by the terms innovation and strategy
Working with Krishnan we, in the Congruent Leadership Team, realized that Innovation and Strategy are not about inspiration alone…. It is a methodology which is scientific and applies to every organization, big or small.. It is a radar which guides where you want to steer the ship to, instead of just floating with the current.
Balaraman Jayaraman, CEO Congruent Solutions, Chennai
If you would like to discuss the topic of innovation, do get in touch with me. You can book a free 60 min one on one discussion here: https://bit.ly/3eLCLGz
Krishnan is a leading innovation consultant and focuses on helping people and organizations innovate and build capabilities for innovation. He brings over 25 years of experience in the industry and consulting. You can reach him by phone / WhatsApp: +919791033967 or email: firstname.lastname@example.org