16 Sep 2019
How innovation keeps you relevant for your customers
How to stay valuable for your customers & employees and keep being innovative?
Recent studies show that 80% of organizations think their business model is at risk of being disrupted. They consider future success to be dependent on innovation, still, only 4% has defined innovation as a strategic priority. Due to the impact of innovation by rapid developments in technology, customer expectations are rising rapidly. And because of the way organizations try keep up and meet those expectations, employee engagement becomes an important concern as well.
So keeping up with trends & developments and following up on them seems to be a big challenge. Why is that?
Explore versus exploit
The main reason why we find it difficult is focus. For organizations in general exploit is the first priority. This concerns the execution their daily business, running their core activities and keeping stakeholders happy. Explore is what usually comes second. By explore we mean the effort to connect and engage with customers, discover their needs and spot new opportunities to innovate.
The balance ratio for organizations between exploit and explore activities today is 90-10 percent. This might seem logical because currently exploit equals (financial) results. However, it does not mean that with this approach the organization is sustainable, relevant or, in other words, future proof.
My firm belief is that in order to make impact for your customers and to be able to keep on growing as a business, the explore/exploit ratio should be 50-50. So, there has to be more focus on exploring ‘what is going on outside’. To build a future proof business, focus on trends and developments, continuous idea generation and following up on opportunities that can really improve core activities and make a difference for customers is essential.
Sure, going from 10-90 to 50-50 is a big gap and 54% of all organisations have trouble bridging the gap between business strategy (exploit) and innovation (explore). So, where to start?
Bridging the gap starts with creating a culture
Change starts with acknowledgement and sense of urgency (the bridge is on fire!). If you lose the connection with customers, employees and technology, you're losing your relevance as a business. Invest in creating a culture where everybody is facilitated, empowered and encouraged to generate and validate ideas, bring in opportunities, co create and start experiments.
Employees will get inspired and they will motivate each other which will increase engagement and bring new insights on customer needs. Maybe this sounds like a lot of effort and investment, but don’t overestimate it. When you start by taking small steps you will notice that everybody already has a way of getting inspired. They just need some coordination and commitment.
The Talent Peaks’ way of innovation
At Talent Peaks we use different ways to get started and to move forward to explore what is going on in our focus industries. For example innovation methods to generate, validate and follow up on ideas like co-creation, a value proposition approach, design thinking, design sprint, lean start-up and rapid prototyping.
Are you inspired to learn more and curious how we can help? Feel free to give us a call. We’d love to share our experience and explore and exploit the possibilities for your business.
Follow my findings
I would encourage everybody to keep an open mind. Follow what is going on in other industries and markets and discover what they are doing well so you can apply it to your own business. My personal way of getting inspired is listening to podcasts, reading blogs and attending seminars.