“Innovation” in a Competitive Startup Economy
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a culture that encourages creativity and problem-solving. It could be as simple as setting aside a few hours every week to nurture the flow of ideas – even if they aren’t work-related. Maybe you’d like to recognize a new innovator every month. The key is to keep the innovation spirit alive and kicking. That, in turn, needs the strong support of top management. When those at the top put the focus on innovation front and center, new ideas and creative behaviors are more likely to flourish across the organization.
2. Be Observant
The best ideas don’t materialize from thin air. They’re born from a keen sense of observation. Oftentimes, great ideas are born when tough problems need to be solved, or gaps need to be filled, or value needs to be created. So, in these situations, encourage your team to be informed and aware. Also encourage your employees to read extensively, talk frequently to your customers, conduct external research, and keep their finger on the pulse of the market. Innovative ideas are everywhere. You just need to have the infrastructure to capture them, nurture them, and help them to reach their full potential.
3. Stay Agile and Dynamic
Amazon realized early on what many other startups hadn’t yet realized – if you want to stay relevant, you have to keep re-inventing yourself. In the two decades or so since it was formed, Amazon has evolved from online bookstore, to e-reader creator, diversified retailer, video on-demand provider, and cloud infrastructure services provider. It is no surprise that the company is successful; it understands that innovation is also about evolution. To stay ahead, you need to be able to innovate faster than the competition.
4. Don’t Just Innovate in What You Do, but How You Do It
In a survey comparing innovation among corporates and entrepreneurs, EY found that “very few of the entrepreneurs were innovating in the ‘back office’ or support functions needed to sustain a growing business.”
This is important because startups tend to think about innovating only in their core products or services. But what about innovating in the way your business is run? Are there creative solutions to get more value out of your finance, legal, or human resources operations and processes?
Take risk management as an example; one of our customers, a leading Middle Eastern aluminum smelter, wanted to significantly improve its risk management program and was looking for innovation. Together, we established a better way for them to identify and assess the top risks in each business unit based on a 3-point estimate. We also mapped their risks to controls for greater transparency, and began running Monte Carlo simulations to calculate their Value-at-Risk. As a result, they significantly strengthened their ability to anticipate and mitigate the risks that mattered to their business. Innovation in risk management has not only helped them to manage their risks better, but also to use risk intelligence to take advantage of new opportunities for growth.
Innovating in the New Year
It’s always exciting to stand on the cusp of a new year; to look backwards at how far we’ve come, and to look ahead to a bright future full of possibilities. The opportunity before us for greater collaboration, more creative thinking, and sustainable value creation is truly immense. On that note, may 2016 be your most innovative year yet.