Why innovation is important?

Agus Wismoyo, Consultant, Accenture, Jakarta

Although many experts have different ways to describe the meaning of innovation, they agree it is about implementing new ideas to create value.

"Innovation is what will give us the edge in the future," says Steve Duthie of Whirpool Corp., while Margaret J. Wheatley, the president of Berkana Institute, states that "innovation means relying on everyone's creativity".

Other experts say that continuous innovation can lead to profits and thus stay in power. Many companies have realized this idea, including: P&G, Royal Dutch/Shell Group and Estee Lauder.

Why is innovation becoming more important? With markets and technology changing fast, and good ideas quickly copied, there is continual pressure to devise new and better products, processes and services faster so innovation is becoming more important day to day.

We will have many losses if we do not innovate. The losses are customers stopping buying our products, processes and services; sales drops; revenue drops; shareholders returns decreasing; stock price drops; and key employees leaving. Innovation leads to faster growth, increased market share and better corporate positioning. Innovation is the prime strategy for the first decade of the twenty first century.

To manage the innovation, we must know the principles of good innovation. We can be inspired by success stories, learn from the experience of the best innovators, identify the key success factors and build the organization's principles of good innovation.

By understanding the market, we can make an innovation that fits with the target. Another principle is "be open", we must open up to any type of innovation (not just product innovation), to any source of innovation (not only research and development), to ideas from outside the organization, to partnerships with other companies (in the same or other industries), to research, advise and seek information from educational establishments, and to the market.

Also, we must be open to customers, listening to what they ask for, their complaints and looking at what they are doing. We must be aware of competitors, watching what they are offering and how they evolve. The third principle is "keep a firm grip on technology".

The next steps are to create the organizational conditions in which innovation can flourish, get everyone on board, define the business processes for innovation and demonstrate management commitment. Lastly, be patient but tough. We must realize that innovation can take time, so do not expect instant results.

Review progress, screen results, analyze risk, and be prepared to weed out low-potential innovations so that resources are available for the best hopes. Besides, remove the blockers who are afraid of change and afraid of success and remove the cynics who lack confidence in your people and ideas.

So, do we dare to manage the innovation and together with your organization implement the innovation to reach the vision?

You can do it if you believe you can. Only the open-minded person that accepts and participates in innovation will be successful.