Innovation and Technology are key words in modern organizations.
The ability to experiment is an essential activity in the innovation process of a company and is one of the main drivers for economically sustainable and long-lasting growth. But what does it mean to experiment for a company?
According to the Treccani dictionary, experimenting means:
“Apply, use, test something to ascertain and verify its functional capabilities, validity, effectiveness, performance”
Experimenting, for a company, essentially means testing innovative solutions in every area of the business in order to improve an existing system.
However, experimentation, or the verification of the introduction of a new methodology, a new product or a new manufacturing technology involves a series of risks related to the intrinsic uncertainty of the innovation process.
- How to verify that the proposed solution is effective?
- What if the solution doesn’t work as it should?
- How to limit the economic impact of a possible bankruptcy?
These are just a few questions that need to be answered when introducing a new solution.
In this post, we will see what are the mechanisms that a company must implement so that the experimentation of new solutions becomes a structured and integrated mechanism in business processes.
Scouting and selection of the concept through a structured approach
What solution to experiment? The first thing to do is to identify the most appropriate innovative solution that solves a particular type of problem. This process, already described in a previous post regarding the adoption of new technologies, requires a structured method to be sure to sift through all possible solutions and therefore not miss opportunities for improvement: a missed opportunity for improvement is essentially a waste which should be avoided.
There are several methods for effective scouting, some of which are:
- Open Innovation: evaluating solutions offered by external organizations, such as start-ups and universities
- Consult with experts in specific fields, both internally and externally to the company
- Implement a structured system of bottom-up idea generation, such as incentives for anyone who proposes innovative solutions in the company
- Appropriately encourage the generation of patents
- Create partnerships with universities and research institutes
- Networking with partners in similar sectors, appropriately managing intellectual property
Once the potential solutions have been identified, it becomes essential to introduce a system to allow the selection of the best solution in the most objective way possible, on the basis of a series of predetermined criteria. In this sense, tools such as prioritization or Pugh matrices can be used (see our online course New Product Development Tools – Part 1)
According to some studies, one of the main reasons why it is difficult to introduce innovation and technology in a company is the fact of not knowing how to manage risk adequately.
In fact, why should a Senior Manager risk introducing new solutions, risking failure and therefore risking his own corporate position, so hard earned?
We have already addressed the issue of Risk Management in a previous post. In general, every time new solutions are tested, a risk is assumed: in fact, we cannot know a priori whether the tested solution will bring the expected benefits. For example, let’s imagine a new product: although we often refer to a series of market surveys through specific techniques (for more details on the subject, we recommend our online course for Market Research) only the field test will tell us if our product , often in the form of an MVP (Minimum Viable Product) will be truly successful or not. Or again, when a new technology is introduced into a production process, there will be the risk that this process is not well accepted by the operators, or that the expected benefits (in terms of quality, time and costs, for example) are simply below our expectations.
In all these cases, you must first accept a certain amount of risk. Second, it is necessary to manage the risk in a structured way, implementing a risk register during the planning phase (also in this case, we recommend the course Tools for New Product Development – Part 2).
Basically, this register lists a whole series of risks that could occur highlighted by the development team, divided into categories. For each risk, it is necessary to evaluate the probability of its occurrence and the impact that the event could generate, as well as indicate the necessary countermeasures to be adopted. In case the probability x impact product is rated too high by the team to be accepted, the initial solution will need to be changed.
Start small, think big
In order to reduce the risks associated with the implementation of innovation and technology, but at the same time validate a concept, it is necessary to implement it on a small scale through a so-called Pilot Project.
Pilot projects are basically the equivalent of an MVP for a new product on the market:
- if it doesn’t work, we have used relatively few resources (money and time) to test it. In addition, we have learned a new lesson, which in turn is useful for the implementation of new solutions;
- if it works, we can scale the idea to other business areas, thus extending the benefits.
What soft skills for innovation?
For an experiment to be successful, not only technical skills are needed, but the so-called soft skills are becoming increasingly important.
Among these, the skills related to Leadership are certainly among the most important. In fact, to be a Leader, it is not necessary to hold managerial positions within the company. In the innovation process, a leader indicates the way forward by motivating the team and positively managing the critical moments and bad moods that inevitably arise in a process full of pitfalls.
In addition, being able to work in multidisciplinary and increasingly multicultural environments, being open to embrace new ideas and at the same time actively collaborating with their group members is another essential skill to cultivate.
Finally, resilience, that is the ability of individuals to cope with stress and adversity by being strengthened, to be able to resist and to positively reorganize their lives and habits following a negative critical event.
Knowing how to manage stress positively therefore becomes fundamental in the context of experimenting with new processes.
What support do we offer?
In this post we have seen how constantly experimenting with new innovation and technology is an essential requirement of every structured company to face future challenges, in a context of increasing global competitiveness. Knowing how to constantly improve business processes implies knowing how to identify the most suitable solutions to the problem, being able to manage the associated risks, implement pilot projects and cultivate some transversal skills, including leadership, knowing how to work in highly multidisciplinary teams and resilience in conditions of stress.
In this sense, Accialini Training & Consulting can provide you with a number of professionals able to support you in all phases of experimenting with new solutions, from the generation of new concepts to the implementation of pilot projects. Moreover, throughout our Leadership Development Program developed by our coach Veerle Ponnet you will be able to cultivate the core competencies underlying effective leadership.
For more info, contact us to discuss more details.