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When Execution Becomes Imperative: Learn the 5 Principles of Innovation Strategy

Editor's Note: Take a look at our featured best practice, Design Thinking (225-slide PowerPoint presentation). [NOTE: Our Design Thinking presentation has been trusted by an array of prestigious organizations, including industry leaders such as Apple, MIT, NASA, Ford, Boeing, Fujitsu, Syngenta, Palo Alto Networks, and Mercer, to name just a few.] Design Thinking is [read more]

Also, if you are interested in becoming an expert on Innovation Management, take a look at Flevy's Innovation Management Frameworks offering here. This is a curated collection of best practice frameworks based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. By learning and applying these concepts, you can you stay ahead of the curve. Full details here.

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In an era of digital business and rapid technology change, virtually no company can ignore the imperative to innovate. Failing to do so is an invitation to lose business.

To learn how companies are responding to this mandate, PwC conducted a major global study in 44 countries. The goal was to understand how leaders view innovation and what is being done to reap its rewards. Findings showed that companies are struggling with aligning innovation efforts with business strategy. Companies across a wide range of industries and technology are also enlisting technology as the driver for market change and innovation and not just an enabler.

A great number of companies are also opening up the Innovation Process earlier to a broader set of stakeholders both inside and outside the company. Customers are already brought in even while in the Ideation phase. Today, innovation is no longer the domain of a chosen few.

In an era of rapid technology and market change, it is now essential for companies to enhance their capacity to innovate. Innovation in the Digital Age has become a mandate imperative to 21st-century business.  It it also tied closely to Digital Transformation initiatives.

The 5 Principles of Innovation Strategy

The 5 Principles of Innovation Strategy are essential in guiding companies to make a breakthrough in Innovation.

  1. Strategy-driven Innovation Spend
    Strategy-driven Innovation Spend enables companies to achieve dual objectives of revenue growth and cost containment. In fact, as a result of applying the Principle of Strategy-driven Innovation Spend, the majority of the companies experience great impact on driving revenue growth with a significant impact on cost management. Nearly all companies experience impact on both top line and bottom-line growth.
  1.  Viable Business Models
    The application of the principle of developing viable Business Models has moved companies to conquer any challenge and stay at the tip of the spear. In effect, silos are knocked down within the company thus enabling companies to better bridge the gap between innovation strategy and business strategy. Business Model Innovation (BMI) has become a core focus areas for many leading organizations in the Digital Age.
  1. Open Innovation Models
    The Open Innovation Models focus on creating more-inclusive operating models. This is now being embraced ahead of traditional R&D and by a wide margin. To date, twice as many companies are moving into open innovation, design thinking, and co-creating with customers, partners, and suppliers.
  1. Human Experience
    Human Experience, our fourth principle, focuses on human experience and insights. As a result, companies are more able to shape and deliver new ideas, solutions, products, and services. Great value is created to markets and businesses.  More and more organizations are embracing Human-Centered Design (HCD) practices.
  1. Technology-driven Innovation
    The final principle looks at technology-driven innovation as leaders. The application of this principle has enabled companies to lead the way in breakthrough innovation. These are the companies that invest the most in innovation as a percentage of revenue.

Taking the Right Approach and Improving the Odds

The right mix of technology and talent, from strategy through execution, is key to improving the odds that a company’s big innovation bets will pay off. Technology partners outrank other sectors such as Pharmaceutical and life sciences, Health services, Communications, and Automotive. Fifty-eight percent of Tech companies consider technology as their most important innovation collaborators. This is fifteen percent more compared to Automotive or thirteen percent more when compared with the Communications companies.

But improving the odds can further be advanced when the proper approaches are used. Each principle has its established key approaches essential in enhancing execution to maximize results. Learning these approaches will enable companies to fully apply the 5 principles of Innovation Strategy more so at a time when execution is now imperative.

Interested in gaining more understanding of the 5 principles of Innovation Strategy? You can learn more and download an editable PowerPoint about the 5 Principles of Innovation Strategy here on the Flevy documents marketplace.

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35-slide PowerPoint presentation
A systematic Innovation process allows an organization to clearly understand who its customers are, their unmet needs, needs to be targeted, product positioning, and new products to be developed. This presentation highlights the Outcome-Driven Innovation (ODI) approach. ODI is a [read more]

Want to Achieve Excellence in Innovation Management?

Gain the knowledge and develop the expertise to become an expert in Innovation Management. Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

To be competitive and sustain growth, we need to constantly develop new products, services, processes, technologies, and business models. In other words, we need to constantly innovate.

Ironically, the more we grow, the harder it becomes to innovate. Large organizations tend to be far better executors than they are innovators. To effectively manage the Innovation process, we need to master both the art and science of Innovation. Only then can we leverage Innovation as a Competitive Advantage, instead of viewing Innovation as a potential disruptive threat.

Learn about our Innovation Management Best Practice Frameworks here.

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About Joseph Robinson

Joseph Robinson is the Vice President of Strategy at Flevy. Flevy is the marketplace for best practices in business management. Learn how the Fortune 100 and global consulting firms do it. Improve the growth and efficiency of your organization by leveraging Flevy's library of best practice methodologies and templates. The documents at Flevy (https://flevy.com) are of the same caliber as those produced by top-tier management consulting firms, like McKinsey, BCG, Bain, and Accenture. Most were developed by seasoned executives and consultants with 20+ years of experience. Flevy covers 200+ management topics, ranging from Digital Transformation to Growth Strategy to Lean Management. You can peruse a full list of management topics available on Flevy here. Prior to Flevy, Joseph worked as an Associate at BCG and holds an MBA from the Sloan School of Management at MIT. You can connect with Joseph on LinkedIn here.

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