Purpose and Objectives of the Special White Paper
Many studies have revealed a clear link between innovation and business performance, and it has become crucial for firms to continually innovate in order to become or remain competitive. A global study of CEOs (KPMG, 2016) found that fostering innovation is now a strategic priority that is incorporated into the business strategies of leading companies. Despite this, many entrepreneurs and organizations struggle in their attempts to become successful innovators. They need a way to examine and assess their competitive position, and to develop a future roadmap that includes bold or disruptive innovations.
This special paper on “The Art and Science of Innovation and Entrepreneurship” takes the form of a question checklist, organized by the themes and sub-themes most closely related to the ability of an organization to be innovative. The paper is intended to help organizations to review their current innovation readiness from an “Art and Science of Transformation”® perspective, and use the outcomes to develop plans and strategies for improving future innovation performance and entrepreneurship.
The Art and Science of Transformation Approach®
An Art and Science of Transformation® approach is important to ensure that an organization has the right skills and expertise in place for successful innovation, and that its culture, systems and processes are properly realigned with the desired innovation goals. In this approach, the “art” relates to the cultural and people-related aspects of transforming an organization for effective innovation, and the “science” to the more formal business methods, tools and processes also involved. In any organizational change initiative, it is essential to achieve the right combination of art and science, and to adopt a holistic approach in order to ensure that any potential barriers to transformation are identified and removed. The questions within each theme of the paper capture various aspects of the “art” and “science” of innovation and entrepreneurship.
Competitiveness and Strategy
The first main theme addresses the importance of ensuring that innovation investments are focused on the specific areas in which a company needs to be “leading edge” competitive. This includes not only the products or services offered, but also the company’s operations. The questions within this section of the paper are designed to help organizations think beyond their current products, services and capabilities, and achieve a deeper understanding of their core competencies and target market.
Competitive positioning: This addresses the firm’s currently positioning in its market with regard to innovation, and the ways in which knowledge about competitors and customers are used to achieve this. The questions encourage users to consider whether the company’s core competencies and strategic capabilities are clearly defined and to identify any barriers to achieve a competitive position in their market.
Understanding Innovation: This section explores the understanding of innovation within the company, and any experiences of successful or unsuccessful innovation. Information is sought on the types of practices or strategies used to guide innovation and the perceived effectiveness of these.
Strategy: In this section, the questions are designed to elicit information on whether the firm has a clearly defined innovation strategy and if so, the nature of this and its objectives. They are designed to help tease out whether the current strategy is effective in driving innovation, and any weaknesses.
The second main theme of the paper addresses the importance of having the right overall environment for successful innovation to take place, since evidence shows that successful innovators adopt a holistic approach to aligning all areas of the organization with their innovation strategy and goals. The questions in this section of the paper are designed to help organizations consider whether any changes are needed in their business model, organizational structure, culture, human resources, governance and management methods and so on.
Business Model and Organizational Structure: These questions explore how well the current business model and organizational structure support innovation, and whether the strategic as well as the direct financial benefits of successful innovation are understood.
Culture: There is a need to ensure that the organizational culture promotes and rewards creativity; tolerates risk, failure and experimentation, and encourages the types of collaborative working that are increasingly important in driving innovation. This section helps organizations understand whether their current corporate culture is promoting or hindering innovation, and whether the firm has a clear sense of strategic direction based on an understanding of the organization’s core purpose and values.
People: The roles of organizational stakeholders in the innovation process are explored using the questions in this section, which are also intended to highlight the ways in which HR practices and processes as well as organizational culture can be used to increase motivations to be innovation and creative at work.
Skills and Competencies: This section explores the extent to which the organization has the skills and competencies necessary for effective innovation, and the ways in which these are developed among staff.
Innovation Process Governance and Management: The processes, practices or methods currently in place to support innovation are explored in this section, as well as any specific orthodoxy or theoretical approach used as a framework for these. Organizations are encouraged to use these questions to consider how effective these are at present and how they might be improved.
Financing and Resources: This section is designed to help organizations determine whether their current levels of investment in innovation are sufficient, and whether the financial returns on this funding are measured and understood.
Risk Governance and Management: These questions explore whether the organization understands the risks associated with innovation and has appropriate measures in place to identify and mitigate these.
Communications: Organizations are encouraged to consider, facilitated by this section of the paper, whether the importance of innovation and creativity is being effectively communicated to employees in their organization and how this might be improved.
Monitoring and Measurement: These questions explore whether the organization currently monitors and measures the performance and impacts of innovation initiatives and, if so, whether the findings are effectively captured as organizational learning.
Commercialization: This section addresses the key issue of commercialization of innovations. Wealth can only be created if an innovation is successfully delivered to the target market, and this requires effective systems and processes as well as a business model that supports commercialization 619 roofing. The questions explore whether organizations currently have these in place and what changes might be needed to improve their effectiveness.
Readiness Assessment: The final section explores whether the organization has previously performed an innovation capabilities assessment, and whether there is currently a perceived need for a similar readiness assessment to identify ways of improving innovation performance.