Tuesday 8 September 2009
AIC Launches its comprehensive approach to building innovation value in companies
Innovation is a term people use in so many ways and contexts that it has come to mean almost whatever you want it to mean.
At the AIC, we use ‘innovation’ in a business context to mean implementing a novel product or way of doing something that creates value in the market. Hundreds of surveys show that firms that innovate outperform firms that don’t. For example, in its 2009 innovation survey, the Boston Consulting Group reported that the total shareholder returns of innovators were an additional 4.3% above their peers.
Yet the statistics show that almost two-thirds of firms in
Commercialisation is intrinsic to business innovation, as it is the step that converts a novel idea into the product or service that renders value. By helping more of its clients to commercialise their ideas, the AIC is working to raise the level of business innovation in
But what exactly does innovation involve? Pick a point on a sphere, and imagine travelling on a circumference drawn around that sphere. The starting point depends on how innovative an organisation is when it begins, but innovation will be a continuous journey along that circumference. Over time, that journey will entail generating a novel idea, sharing that idea within the organisation or with others so it can be commercialised into a product or service, using it, seeing it broadly diffused, learning from its use, and ultimately, improving it with more new ideas. The journey is shown in Figure 1 and never ends.
Figure 1
Different firms will need different levels of support as they circumnavigate the innovation sphere. Of course, employees firstly need to understand and be motivated to innovate [Innovation Awareness]. They might need greater skills to commercialise [Skills] or mentoring support to make sure they are on the right track, for instance in product development or licensing [Innovation Coaching]. Organisations also need targeted information about market opportunities or evaluation tools to help them make important investment decisions [Information, Tools, and Information]. Tapping into the right value chains to take products to markets requires linkages and networks [Partners and Collaborations], and ultimately, capital [Investment].
The specific support services that the AIC provides along the journey are shown in Figure 2. Information on each of these is available on the AIC website. Their usefulness will depend on a firm’s location on the innovation sphere and its current innovation intensity. For instance, organisations that are new to innovation may require mentoring or coaching from AIC Innovation Coaches, while firms that are already innovating may find open innovation through partnerships and collaborations of greater value.
Figure 2
Open innovation is a recent trend, and is used to describe the way organisations improve their innovation performance by intensifying collaboration across industry networks and partnerships. It entails using technologies and ideas developed elsewhere to develop new products or services within the firm (technology exploration) and leveraging existing technologies and ideas outside the boundaries of the firm (technology exploitation). Firms will do this to meet customer demands and market developments, or for corporate renewal, or perhaps for employee involvement and motivation. By its very definition, open innovation entails strategic inter-firm relationships to achieve outcomes that a firm cannot achieve by acting on its own. The AIC’s collaboration services, such as TechFast and TechClinics, help to find, establish, and nurture such partnerships through the difficult phases where different organisational cultures and visions need to become aligned.
After all is said and done, innovation should become indistinguishable from core business – creating customer value in novel ways. If you’re new to commercialisation, contact the AIC to see if we can help.
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