As a regional consultancy helping clients analyse, develop and implement growth strategies, Whitecap Consulting is acutely aware of the impact of successful innovation. Here, Lal Tawney outlines some of the challenges and benefits of innovation, and some practical steps for organisations to keep innovating despite these uncertain times.
In its simplest form, innovation involves delivering ‘something different that has impact’ to a target – which could be clients, customers, employees and/or society in general. Impact can be gauged in terms of a measurable outcome such as return on investment or profit, improved performance of a process, or having a tangible effect on someone’s user experience
The importance of innovation was highlighted recently when Jeff Bezos announced he was stepping away from being CEO of Amazon. In his goodbye letter to staff, he outlined that “invention is the root of our success”, and he asked for them to “keep inventing”.
The COVID-19 pandemic stimulated organisations to adapt and innovate; Grant Thornton’s International Business Report (IBR) from last year showed that 88% of UK mid-market companies surveyed had made fundamental changes to their business models – with more than 50% of respondents expecting to continue with the new model over the long term. In some industries (especially those that are Tech focussed) responsibility for aspects of innovation and development is pushed “up the chain” towards smaller organisations. For these SMEs to stay relevant they must demonstrate to their end customers not only the production of competitive, high-quality products or services today – but also their commitment to developing the skills, resources and agility to remain competitive suppliers in the future.
Whitecap’s own research into the innovation challenges facing mid-sized enterprises in the UK has identified some important factors that often inhibit innovation.
- inherent risk aversion characteristics – mid-market firms generally have lower cash reserves and fewer technical/managerial competences to invest in innovation.
- a need for tailored processes – models for innovation in large firms seldom translate to smaller and mid-market companies.
- the need for greater clarity in the business support landscape, particularly with regard to business growth services available within Local Enterprise Partnerships (LEPs).
- a lack of intellectual property rights (IPR) strategy – many firms do not have IPR integrated into their overall business model due to a lack of knowledge and expertise.
- an innovation skills gap that is a barrier to embedding growth mindsets, systems and skills throughout the firm to drive innovation and the assimilation of new knowledge through external partners and customers.
Based on our experience at Whitecap, we believe that all organisations who are facing innovation challenges, should start with some practical steps to develop their innovation capabilities:
- Innovation Audit – Perform internal and external assessments to benchmark your organisation’s existing innovation capability. Having the perspectives of an independent external facilitator with experience across different markets will strengthen the learning outcomes from this exercise.
- Innovation Ambition – Define the forms of innovation that drives growth and helps deliver your strategic goals. Your senior leadership team working in partnership with external experts should leverage the findings and recommendations from the ‘innovation audit’ stage.
- Innovation Roadmap – Develop the framework that supports the channels for innovation to flow through your organisation. Innovation should be formalised in the agenda at your regular leadership meetings. Your innovation journey can be tracked by setting performance metrics and targets (quantitative – such as financial returns associated with new customer propositions; and qualitative measures that positively challenge and change current behaviours and norms from an innovation viewpoint).
We are always interested to learn about the specific innovation challenges facing organisations and would welcome the opportunity to discuss how we might provide an independent external perspective to support your innovation journey. For an initial discussion, call Lal on 01908 041228 or email [email protected].
Established in 2012, Whitecap Consulting is a regional strategy consultancy headquartered in Leeds, with offices in Manchester, Milton Keynes, Bristol and Newcastle. We typically work with boards, executives and investors of predominantly mid-sized organisations with a turnover of c£10m-£300m, helping clients analyse, develop and implement growth strategies. Also, we work with clients across a range of sectors including Financial Services, Technology, FinTech, Outsourcing, Consumer and Retail, Property, Healthcare, Higher Education and Professional Services, and Corporate Finance and PE.