The role of innovation in changing times

The maxim that the crisis creates opportunities and that the solution can come from innovation is, more than ever, a true statement. According to McKinsey consultancy, history shows that companies that invested in innovation in times of crisis, outperform their peers during the recovery. Innovation is the engine to rescue companies from the sea of storms and cost competition that seem to be constant in times of low economy.

There is a clear tension for business leaders to choose the most appropriate path to lead the company during and post-pandemic, when business sustainability overlaps with investments with innovation and risk paralyzes change.

But this dilemma is not new, it always resurfaces in crises! Also because crises are cyclical. Therefore, innovation has the vocation to build the capacity to be able to react to them.

​

So, are we in agreement that innovation is essential for business success and longevity? If innovation plays a central role, why do over 90% of initiatives still fail? This brief article suggests how we leaders can increase our chances of success and navigate better in this time we live in – with scarce resources, uncertainties and the need to be more assertive.

​

First, let's level the understanding of innovation. What is innovation? There are many interpretations on the theme, which include "creating new things", opening new territories, developing more relevant products and services, being the first, bringing value, being digital and so on... All these definitions apply, in greater or lesser intensity, depending on the segment, profile and ambition of the company.

However, innovating doesn't necessarily mean finding something totally new to the world, and it doesn't need to be linked to technology and digital. Nor is it just about launching a new flavor or a new color for the product's packaging.

​

Innovation can and should be applied in different sectors and must be comprehensively pursued within the company, from small modifications to disruptive paths. There is room for process improvement, production cost reduction, delivery agility, new customer relationships, implementation of intelligent systems, new products, new business models, the list is long...

Therefore, being innovative is about looking for ways to gain competitive advantage, it's about questioning the business model, it's about making curiosity contribute to the evolution of the model, it's about risking change to grow, it's about rethinking the market dynamics and it's, mainly, investing in people.

Innovation management

But in order to innovate, it is necessary to have the management to orchestrate a set of initiatives, which when combined, bring a positive impact and value to people, the business and the environment. And of course, this only happens when there is a deep understanding of the market with a look to the future and a well-defined strategy. In other words, innovating requires a systemic view of the business to prioritize initiatives that will impact both the company's internal configuration (its business model, network of relationships, processes, logistics, for example) and those that seek to improve the customer experience (for innovations in products, services, and brand building). This way of thinking and the discipline of innovation is in tune with the work of Larry Keeley, an American strategist who studies innovation (recommendation for reading below).

​

And how to succeed with innovation? There is no simple answer and off-the-shelf designs. The journey will certainly include a reflection on the future, leadership ambitions, the current structure, its collaborative forms and culture. We always reinforce that the important thing is to take the first step, even if it is small, and from the first “quick wins” onwards, expand the scope. The way forward requires long-term focus and commitment.

Bringing innovation to the center of strategy is a challenge that DMS Partners partners have experienced in their executive careers as former CEOs, VPs and Directors of large organizations, or acting as Heads and mentors of startups. The balance of the traditional with the new, the pragmatism of results and the systemic vision of the future have been great values given to partners and customers from the most diverse segments and industries in supporting their innovation journeys, bringing the look of outside the company to instigate and promote reflection for change.

What stage of innovation are you and your organization at?

1. I don't know where to start and how to introduce innovation
2. I want to innovate, but I have difficulties because the structure is rigid
3. I've already started the innovation process, even if it's still at an early stage, but still without efficient management and no continuity
4. Innovation is part of my organization, we have efficient processes

​

We, from the DMS Innovations team, propose to look at challenges from a new perspective, and we support companies at any stage of maturity, in the timing and right measure for each organization (Organic and Evolutionary Management; Ecosystem Management/Open Innovation; Corporate Venture Capital ).

DMS Innovation @ Marcelo Cruzato; @Charles Beck Varani; @Suzana Domingues

(1) Source: Ten types of innovation book – Larry Keeley, Ryan Pikel, Brian Quinn